Biden Rule Would Hand Caregiver Funds to Unions

Unions siphoned $147 million from taxpayer checks before Trump ban

A home health care worker helps a patient / Getty Images
October 2, 2021

The Biden administration may soon allow unions to take Medicaid funds from caregivers—a practice the Supreme Court has ruled unconstitutional.

Family members and professional caregivers can qualify for Medicaid reimbursements for the cost of care they provide to disabled relatives, but some states have siphoned those payments into union coffers. The Trump administration banned such pro-union schemes in accordance with a 2014 Supreme Court ruling, but the Biden White House is looking to revoke federal prohibitions against third-party payments.

The United States Court of Appeals for the Ninth Circuit temporarily closed the docket until February 1 as the Biden administration proposes new rules.

The Biden proposal could prove a major boon for the president's allies in organized labor. Unions in 2017 alone took in an estimated $147 million in dues from at-home caregivers, according to data collected by the labor watchdog Freedom Foundation. Maxford Nelsen, the director of labor policy at the Freedom Foundation, said overturning the Trump rule would unnecessarily divert money from the disabled to the politically connected.

"There is simply no provision in federal law that allows a state to divert part of a home caregiver's Medicaid payment to a labor union under any circumstances," Nelsen told the Washington Free Beacon.

The Biden administration did not respond to request for comment.

Labor unions spent more than $240 million on politics during the 2020 election cycle, the vast majority of which benefited Democrats, according to the Center for Responsive Politics. Biden regularly boasts that he is the most pro-union president in history. William Messenger, a staff attorney for the National Right to Work Legal Defense Foundation, said the Biden administration would reimplement the scheme, which helps fund Democratic Party campaigns and causes to enforce pro-union policies.

"What you're seeing is a misuse of Medicaid funds being steered away from paying for care to disabled people and being used for politics," Messenger told the Washington Free Beacon. "They set up an entire system to pressure Medicaid providers to assign a portion of their Medicaid funds over to unions and political action committees."

The Obama administration established federal regulations in 2014 that allowed third parties to receive Medicaid funds, which legalized dues payments for union caregivers. Within months the Supreme Court ruled in Harris v. Quinn that an Illinois law that mandated dues payments from caregivers was unconstitutional.

The Trump administration repealed the Obama regulations in 2019, sparking a joint lawsuit from Democratic officials in California, Connecticut, Massachusetts, Oregon, and Washington. Xavier Becerra, who is now the secretary of health and human services, spearheaded the suit as the attorney general of California. The case is now on hold in light of the Biden administration proposal.

Nelsen said Becerra's promotion serves as a prime example of how dedicated Biden and the Democratic Party are to boosting their union allies.

"It's a shame and it's an irony," Nelsen told the Free Beacon. "It's a symbol of the direction this administration wants to go and the priorities it has, which are in the interest of union bosses and not home caregivers that rely on Medicaid."

F. Vincent Vernuccio, a strategic adviser at Michigan's Mackinac Center for Public Policy, said Biden is more concerned with returning favors to his union allies than protecting caregivers.

"This is about the Biden administration doing whatever they can to boost union organizing and increase union financial offers at the expense of workers, which in this case is friends and family members providing care," Vernuccio told the Free Beacon.