Freedom Foundation

Ask the Trump administration to end union dues skimming from Medicaid

As was announced last month, the federal Centers for Medicare and Medicaid Services (CMS) is moving ahead with the repeal of an illegal regulation that provided some legal cover for states to divert union dues from Medicaid payments to home caregivers, an action the Freedom Foundation has called for since last year.

Federal Medicaid law requires payment for services be made directly and in-full to home caregivers. But, for years, unions and state officials have ignored the law and federal officials have looked the other way. In 2014, the Obama administration even adopted a regulation to allow states to deduct funds from caregivers’ wages for “benefits customary to employees.”

Technically, the 2014 U.S. Supreme Court decision in Harris v. Quinn gave caregivers the right to choose for themselves whether to financially support a union. Practically, though, many caregivers remain trapped by schemes concocted by SEIU 775 and the state to keep IPs paying union dues whether they want to or not. In Washington state alone, more than $21 million in Medicaid funds are skimmed from caregivers wages each year. Nationwide, unions collect about $150 million per year from Medicaid-paid home care aides.

Most of these coercive practices are enabled by the state’s role as dues collector for the union.

If CMS proceeds with the repeal of the 2014 regulation, it would not prevent any IP from choosing to join a union if they wish. They would simply have to pay union dues directly, just like any other bill, instead of having the money taken from their paycheck.

Taking the state out of the business of collecting union dues would give caregivers much more control over their participation with the union. The state couldn’t seize union dues automatically without permission. The union could no longer lock people into paying dues just by pressuring them to sign a piece of paper at their orientations or trainings, or by agreeing over the phone. Instead, the union would have to get people to pay them directly.

Before CMS can proceed, however, the repeal of the 2014 regulation must go through a public comment period.

Please consider submitting a comment in support of CMS proposal number CMS-2413-P. The public comment period closes at 8:59pm Pacific time on Monday, August 13.

Comments can be submitted online and do not have to be lengthy. Do mention that you support proposal number CMS-2413-P.

Additional resources and background material can be found in a recent Freedom Foundation report, “Getting Organized at Home: Why Allowing States to Siphon Medicaid Funds to Unions Harms Caregivers and Compromises Program Integrity.

Pages 29-39 discuss the history of SEIU 775’s unionization and treatment of caregivers in Washington state, while pages 104-106 explain why federal law prohibits state collection of union dues from Medicaid payments.