New Areas of Reform on the Long-Term Care Labor Force Crisis

There is a growing consensus that America’s long-term care (LTC) system faces a crisis in providing sufficient health care and social needs to an aging society (Bragg and Hansen 2011; Bryant and Stone 2008; Institute of Medicine 2008; Miller, Booth, and Mor 2008; Stone and Barbarotta 2011). A major concern is the impending disparity between the increasing demands of health care needs and the decreasing supply of the LTC workforce. The first of the Baby Boom generation began turning sixty-five in January 2011 (Stone and Barbarotta 2011), and after 2015 the amount of individuals requiring LTC is expected to increase considerably. The government estimates that the number of persons utilizing paid LTC services will raise from 15 million in 2000 to 27 million in 2050 (Friedland 2004). At the same time, the overall labor force relative to the population size will likely be smaller than it is today, and there will be fewer adult children to provide informal care to their aging parents due to declining fertility rates (Friedland 2004; Lakdawalla and Philipson 2002).

In order for the LTC workforce to keep pace with the substantial increase in the aging population, it would need to grow, at a minimum, by more than 2 percent each year; however, it is currently only expected to increase by 0.3 percent per year (Friedland 2004). Future policies must address this shortage by ensuring the availability of a large and competent paid workforce. The problem is that the current workforce is unstable due to factors such as unqualified workershigh turnover rates, and low wages, which makes it difficult to recruit and retain workers. This, in turn, has negative effects on quality care.

According to the traditional economic theory, when there is a labor shortage of workers employers will increase wages in order to attract new workers to the market (Feldman 1997). Wage increases also raise the price of services to the consumers, which often leads to fewer demands for services. This combination tends to restore equilibrium to the labor market (Feldman 1997).

The LTC market is different than the typical competitive labor market because it is influenced by the government along with other public and private sectors (Burbridge 1993). The government accounts for the majority of industry revenues, and their payment policies have substantial influences on both the demand for services and the industry’s ability to deliver them (Feldman 1997). In particular, professional training in the health care field is governed through federal and state statutes and regulations, which restrict employers’ means to increase wages as a way to meet the changing demands (Feldman 1997). These factors cause imperfections in the traditional supply and demand model because the labor force is affected by both the market and political pressures (Burbridge 1993). Because of this situation, the government must work together with the public and private sectors in order to find solutions to this problem.

There are major trends that tend to affect the LTC labor market supply and demands. The supply of labor is affected by the size and composition of the employee pools, wages, benefits, working conditions, and alternative sources of employment and income (Feldman 1997). Factors that can increase the demand for service and paid labor include: number of aging older adults requiring both post-acute and chronic care, the declining availability of informal caregivers, the growth of Medicare and Medicaid benefits, constraints on hospital inpatient payments and length of stay, and technological developments that allow more treatments to be provided at home (Feldman 1997). All of these factors can be applied to the aging population, and thus, should be taken into consideration when planning for LTC industry changes in the coming decades.

The aim of this paper is to provide a précis of the LTC labor force issues. It will bring together the available information on current and future labor market needs in LTC and identify the best practices in recruitment, retention, education and training of LTC workers at every level. The first section discusses the current state of the LTC system and defines the specific problems. The next section reviews the recent areas of reform in terms of meeting the current and future LTC needs. The final section offers suggestions for future training and education programs in LTC. Overall, there are legitimate concerns regarding how to provide quality care to a rapidly aging society with a declining LTC workforce. One of the first things required is to create new pools of qualified workers in order to meet the demand for LTC services in the near future.

The Current State of LTC- Defining the Problem
At present, there are multiple factors that negatively affect the LTC workforce and quality of care, which will continue in the future if the issues are not addressed. These factors include the following: the rapid aging population, a heterogeneous group with different needs, inadequate workforce, absence of incentives, and the different demographics of the frontline workers and their care recipients. This section provides a description of each issue and explains how it is problematic for the LTC labor force system and the recipients.

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