ANCOR Issues Statement on Significant Salary Threshold Increase Mandated by Final DOL Overtime Rule

In response to the Department of Labor’s (DOL) final Overtime Rule, published today after having been proposed in September 2023, ANCOR CEO Barbara Merrill released the following statement:

“Though rightfully focused on shoring up our nation’s workforce, DOL has unfortunately and dangerously overlooked the impact this increased overtime salary threshold will have on Medicaid-funded disability service providers. As countless ANCOR members shared with DOL–and which DOL even acknowledged in its rulemaking–Medicaid is often their only source of funding and providers do not have the ability to increase funding to meet increased cost of service delivery. Unless lawmakers increase Medicaid reimbursement rates to allow providers to meet this unfunded mandate, many providers simply won’t be able to comply with this rule without closing programs and services, thereby risking employment for thousands of workers and threatening access to crucial services for people with disabilities.

ANCOR supports policies that uplift workers, increase wages, and provide economic stability through monetary compensation and other quality benefits. However, DOL’s choice to exclude from its final rule a mechanism for ensuring Medicaid-funded providers can comply risks hurting the very workers the rule is trying to protect. A 2023 research study commissioned by ANCOR found that the rule could impose more than $1 billion in additional expenses for providers in the first year alone, potentially forcing them to restrict overtime hours, convert salaried workers to hourly, or even reduce the number of salaried, full-time workers on their payroll altogether.

The nature of Medicaid as a state-federal partnership means that community providers cannot unilaterally raise rates to generate the funding that would be needed to meet increased operating costs–doing so requires commensurate reimbursement rate increases from their states. Absent action from DOL or Congress, this reduction in the disability services workforce could be absolutely devastating at a time when the inability to recruit and retain qualified DSPs is already at a crisis level.

ANCOR calls on DOL to act immediately to ensure policies are in place that provide necessary time to meet the requirements of the rule without jeopardizing access to community-based services, and on Congress to pass the Disability Community Act, legislation that would furnish increased federal funding for I/DD services to offset the cost of compliance.”