Your Employees may be Eligible for a $3,000 One-Time Bonus, paid mostly by the federal Government

As we reported in our April alert, the New York State Budget established a healthcare worker bonus (the “Bonus”) program that would pay up to $3,000 to qualified healthcare workers that are employed by qualified providers. On August 3, the Department of Health notified providers through eMEdNY that the healthcare worker bonus program (“HWBP”) has been activated, and that a portal has been established through which providers would submit required information to apply for their employees’ bonuses. The Department’s website for the HWBP is generally robust, and available here. The information that is plainly on the website will not be repeated here. Instead, this alert will focus on some common outstanding questions that have not been addressed by the Department, as they relate to home care providers. Clearly, the HWBP was designed around the hospital and, a little less so, the nursing home setting. Thus, much of the Department’s guidance and interpretation of the HWBP does not translate easily to the home care context.

Initially, insofar as entity eligibility, we know that CHHAs and LHCSAs are covered by the HWBP. There is generally a requirement that the provider be enrolled in Medicaid, but some avenues for non-Medicaid providers also appear to exist. In addition, although not mentioned by the Department on its website, the HWBP law itself states that other Medicaid-billing providers may participate in the program, so long as “at least [20%] of the provider’s patients or persons served are eligible” for Medicaid services. Thus, this 20% threshold is relevant to providers who not only operate a home care program but may offer related healthcare services.  

Providers who rely on staffing agencies for healthcare labor cannot seek and obtain bonuses for those healthcare staff that is assigned by the staffing agency, as per the DOH’s FAQs (available here).

Fiscal Intermediaries are outright considered ineligible employers by the Department, per the DOH’s FAQs.

Separately, insofar as employee eligibility, we know that New York State has determined that direct care staff, such as HHAs and PCAs, are not eligible for the Bonus. In their FAQs, the State has explained that, due to the $2.00 minimum wage increase taking effect October 1, home care workers have, effectively, been rewarded sufficiently.  However, other clinical staff employed by home care agencies are eligible for the Bonus, such as nurses and therapists. It Is not clear if such clinical staff, to the extent they worked remotely (as they were authorized to do during the vesting period under various regulatory waivers), would be eligible for the Bonus. This question has not been addressed, but we know that there is an emphasis in the HWBP in rewarding “front line” workers.

In addition, it is not clear if other office staff, such as coordinators, HR intake, and compliance employees would qualify for the Bonus. In the DOH’s list of eligible employees, various clerical and clerk positions are identified as “other health care support workers” who would be eligible for the Bonus. The names of these titles suggest that they are hospital and nursing home-setting positions, where there would be some potential of front-line work and patient-facing responsibilities. It is unclear if this rationale extends to home care, where the office staff rarely, if ever, interacts directly with patients of home care services. This is a pivotal issue for LHCSAs and CHHAs. In our conversations with the DOH, we were not given an explanation or any guidance. Rather, the DOH suggested that providers begin the enrollment process on the portal and address these worker eligibility issues through the application process. 

Separately, another outstanding issue has to do with the salary cap of $125,000. The HWBP limits the Bonus to individuals whose annualized base salary is $125,000, excluding overtime and bonuses. However, it is not clear whether other compensation (such as shift differentials, vacation pay) can be considered as part of the base salary.

Insofar as taxes and payroll obligations, the DOH takes the position that the $3,000 bonus is not subject to New York personal income tax. There is no mention of federal income tax implications.  There is also no mention of unemployment insurance or workers’ compensation implications of the $3,000 payment. We have sought clarification of these items, since there is no reimbursement to covered employers for these ancillary related costs of paying a $3,000 bonus.

Lastly, the HWBP is a mandatory-participation program. Employers must submit claims and seek the Bonus for their eligible employees’ bonuses. Any employee who does not receive a bonus that they may be entitled to is directed to complain to OMIG’s Fraud Hotline. Thus, for any employer that might be overly frustrated by the lack of clarity, or potential payroll and overhead obligations of the HWBP, such employer does not have the option to waive participation.

We will be following up with the DOH on these outstanding issues, and others. In the meantime, if you have any questions about the program, please let us know.