Disability Service Providers Worry About New Rule

A proposed Department of Labor rule which would increase the salary threshold for paying overtime will strain providers of community-based supports, such as Rainbow of Challenges, who are reliant on state and Medicaid funds to provide services.  This rule could have a serious impact on the ability to provide quality support to those who need them.


Without additional funding, community providers of services to people with intellectual disabilities will have difficulties finding the money from their current budgets in order to comply. These critical programs and individualized services provided will be severely compromised with a direct impact on the individuals served.


As a non-profit agency, Rainbow of Challenges would be unable to absorb an estimated $300,000 cost increase and the Overtime Exemption Rule would limit the ability to pay more to the Direct Support Professionals, known as DSPs, who are the first line of support to the individuals ROC serves.


“If passed, the proposed rule will do the opposite of its intent to employees of non-profit agencies like ROC,” said Rainbow of Challenges’ CEO Judy Watson. “It will require doubling the wages of employees on salary and will force us to remove more than half of the current salaried employees and move them to an hourly status.”


“This will likely be the case for most non-profit provider agencies across the country that are funded primarily by Medicaid”, Watson noted.


Congress is currently being urged to consider legislation which would increase funding so providers can comply with the Overtime Exemption Rule and other unfunded mandates so there is no interruption or dissolution of services that are currently provided.


The Department of Labor is also being urged to implement a gradual increase in the salary of DSPs in order to avoid such a crisis.