The Benefit Cliff: What It Is and Why It Matters to Senior Living Providers Now
The benefit cliff is an underappreciated problem for senior living providers in their staffing efforts. This societal issue is contributing to the creation of a workforce that must limit its labor hours in order to continue receiving public benefits. The benefit cliff continues to go unaddressed, and senior living providers are encountering scenarios where they aren’t able to find enough staff that will work enough hours to maintain the provider’s high level of service.
What is the benefit cliff?
The benefit cliff is a term used to describe when a low-income family receiving public benefits gets a slight increase in their pay which results in a sudden loss of program eligibility.
Why it matters to senior living providers
If a member of your staff gets a moderate raise, or an increase in hours, it may cause them to lose the benefits that they are currently receiving at a federal or state level. If the raise or increase in wages due to increased hours does not make up for the benefits lost, your staff member can be put in a dire situation, unable to pay for housing, childcare, or other necessities.
For the most part, the amount of public benefits an employee receives is dependent on the makeup and size of the household (number and age of children, gross income of all adults, child support, location etc.). Gauging employees’ needs can be incredibly difficult when several factors are impacting their total benefit package.
When staffing is already in short supply in the senior living industry, the benefit cliff exacerbates the issue, presenting your employee population with an unwinnable choice between better wages and benefits that significantly affect their family’s wellbeing.
Many employees will choose to maintain their public benefits instead of taking on more hours or accepting a slight increase in pay.
How do you keep the benefit cliff from happening?
The COVID-19 pandemic has made it even clearer that access to public benefits can impact individual choices when it comes to employment. Senior living providers need to be aware of their specific employee population’s social determinants of health and how those factors may be contributing to the difficult choices employees need to make in regard to how often they work and for what wages. Detail-oriented providers must dig deeper into their employee population’s demographics, because the impact of the benefit cliff can also be heightened due to family size and needs.
If providers do not take their employees’ specific needs into account, the benefit cliff will continue to cause a staffing level issue for employers. Employees whose social determinants of health are not well-supported will continue to choose lower wages and less hours in order to maintain the benefits provided by the state and federal government.
Senior living providers facing this concern and looking to implement solutions customized to their organization should consult with their M3 account executive, who can provide innovative, yet proven, strategies for addressing this issue. Effective solutions can increase talent retention, build employee loyalty and culture, and allow you to focus on risk management and providing exceptional care to your residents.