June 3 Federal Update: Business Groups File Lawsuit to Block New Overtime Rule

On May 22, over a dozen business organizations filed a lawsuit to block the Overtime Final Rule from going into effect. Filed in Plano, Texas, the same federal district court that struck down the Obama-era overtime rule, the business groups seek to vacate and enjoin the rule, declaring it beyond the Labor Department’s authority. They aim to block the salary threshold increases set for July 1, 2024 and Jan. 1, 2025 as well as the Department of Labor’s (DOL) plan to index the thresholds for inflation every three years.

The core argument is that the 2024 Rule raises the minimum salary threshold to a level the business groups believe is no longer a plausible proxy for the categories exempted from the overtime requirement by Congress. For over 80 years, salaried workers earning below a certain threshold have been entitled to time-and-a-half pay when working more than 40 hours per week. The threshold, however, has increased far slower than wage growth, excluding many lower-paid salaried workers from overtime protections.

The DOL’s rule will raise the minimum salary threshold for the overtime exemption for executive, administrative, and professional employees in two stages, additionally providing increases every three years to keep up with wage growth. This change will extend overtime protections to nearly one million workers, with an initial salary increase to $43,888 on July 1, up from $35,568. It will extend protections to about three million more workers on Jan. 1, 2025, with a second increase to $58,656 annually.

The plaintiffs argue the new rule will drastically increase labor costs and complicate employee relations, particularly for small businesses and non-profits. They claim the rule will require the reclassification of millions of employees from salaried to hourly workers, resulting in restricted work hours, reduced opportunities for advancement, and hindered job performance. The automatic indexing provision for salary thresholds is also seen as problematic, adding to potential operational costs and economic strain.

In the complaint, the plaintiffs argue the 2024 Rule will impermissibly deprive millions of employees of their exempt status, making their duties, functions, or tasks irrelevant if their salary falls below the new minimum. They claim the rule contradicts congressional intent and the statutory limits of the Fair Labor Standards Act (FLSA). The business groups are seeking expedited consideration of their complaint to avoid the impending changes set to take effect in July 2024 and January 2025.

The outcome of this legal challenge will have significant implications for employers and employees across various industries, particularly in how businesses manage and compensate their workforce under the revised overtime regulations.

Senate Finance Committee Reviews Progress and Challenges of the Family First Prevention Services Act

On May 22, during Foster Care Awareness Month, the Senate Finance Committee held a hearing titled “The Family First Prevention Services Act: Successes, Roadblocks, and Opportunities for Improvement.” The session gathered experts, policymakers, and stakeholders to discuss the progress and challenges of the Family First Prevention Services Act (FFPSA) since its 2018 enactment.

Sen. Mike Crapo highlighted the bipartisan nature of FFPSA, focusing on transforming child welfare to prioritize prevention and family preservation. He emphasized the importance of mental health and substance use disorder treatments in keeping families intact and reducing reliance on foster care. Crapo noted recent regulations to reduce bureaucratic barriers for family members to become licensed foster parents, which support children living with trusted caregivers. Chairman Ron Wyden stressed the necessity of federal funding to empower kinship caregivers and the importance of prevention services to address mental health and substance use disorders. He called for removing bureaucratic barriers that prevent states from fully utilizing available prevention funds and urged better allocation of resources towards prevention services.

JooYeun Chang from the Doris Duke Foundation discussed the impact of FFPSA in shifting the child welfare paradigm toward prevention. She noted barriers to accessing necessary services and recommended structural changes to broaden eligibility for prevention services, including support for domestic violence and economic hardships. Chang emphasized community-based support systems and data-driven approaches to serve at-risk populations effectively. David Reed from the Indiana Department of Child Services highlighted Indiana’s success in reducing the number of children in foster care by over 50%. He emphasized the importance of flexible, comprehensive service models like Indiana’s Family Preservation Services, which address various family needs. Reed shared examples of targeted interventions, such as providing transportation support, which have kept families together and reduced racial disparities in child removals.

Rebecca Jones Gaston from the Administration for Children and Families discussed the broader implementation of FFPSA across states and tribes, emphasizing cultural responsiveness in prevention programs and regulatory actions to strengthen kinship care. She pointed out workforce shortages as well as the need for better collaboration across service systems. Gaston stressed the role of federal support in overcoming these challenges and the importance of continuous evaluation to measure prevention program effectiveness. The hearing underscored the commitment to improving child welfare through FFPSA. Significant progress has been made, but challenges remain. Continued collaboration between federal and state agencies and community partners is essential to refine and expand prevention services, ensuring all children can grow up in safe, stable, and loving environments.

Senate Committee Examines Reauthorization and Impact of the Older Americans Act

On Thursday, May 23, the United States Senate Special Committee on Aging held a hearing to discuss the impact of the Older Americans Act and its upcoming reauthorization. May is recognized as Older Americans Month, celebrating the contributions of older persons to our nation and highlighting the need for resources and services to support the aging process. Chairman Bob Casey (D-Pa.) spoke of the Act’s success in helping countless older adults access nutrition services, legal support, and social networking, among other services. He emphasized critical priorities for the reauthorization, including the Strategic Plan for Aging Act to improve public-private partnerships and the importance of Long-Term Care Ombudsmen in monitoring nursing home safety.

Sen. Mike Braun (R-Ind.) highlighted older Americans’ economic challenges, especially amidst unprecedented inflation. He emphasized the importance of innovation and flexible spending to meet individual needs. He addressed the administrative burdens and changing definitions of “Greatest Social Need” that impact access to nutrition programs. Braun advocated for transparency and increased oversight, requiring the Administration to summarize state ombudsman long-term care annual reports and publish a list of funded resource centers.

Janet Billott, a former nursing aide and recipient of Meals on Wheels, testified about the immense impact of the service during her illness, noting the connection she built with Fred, her delivery person. She also praised the Area Agency on Aging for providing transportation to medical appointments and vouchers for a local farmers market, advocating for the program’s expansion.

Laura Holscher, executive director of Generations Area Agency on Aging, discussed the funding provided through Title III B of the Older Americans Act, which enables critical interventions such as in-home services, senior transportation, home modifications, and legal services. She highlighted the flexibility of OAA Title III B in meeting community needs and recommended additional flexibility for Title III D funds to support evidence-informed programs.

Leslie Grenfell, executive director of Southwestern Pennsylvania Area Agency on Aging, detailed challenges her agency faces, including transportation, recruitment and retention of direct care workers, and increased reimbursement. She advocated for increased funding to meet the needs of a growing older adult population, noting the vital support provided by the American Rescue Plan Act.

Connecticut State Long-Term Care Ombudsman Mairead Painter emphasized ensuring residents’ rights in care facilities. She spoke about the challenges of insufficient and unstable funding, which hinder the Ombudsman’s ability to respond to complaints and monitor facilities effectively. Painter called for increased funding and refilling the national director position for the Long-Term Care Ombudsman Program to address these issues.

The hearing underscored the need for increased transparency in long-term care funding, flexible funding to serve diverse communities, and enhanced connectivity to combat the lasting effects of loneliness exacerbated by the COVID-19 pandemic. The Older Americans Act is essential in helping older adults age healthily by increasing access to nutrition, healthcare, and transportation. Providing support before individuals reach higher levels of need can improve quality of life and generate significant cost savings. However, a rapidly growing aging population and workforce shortages have hindered service provision. Increased flexible funding that accounts for unique community needs is essential to maintaining the progress and value of the Older Americans Act.

Senate Finance Committee Addresses Comprehensive Strategies to Combat Fentanyl Crisis

On May 23, the Senate Finance Committee held a crucial hearing titled “Front Lines of the Fentanyl Crisis: Supporting Communities and Combating Addiction through Prevention and Treatment.” The hearing underscored the severity of the fentanyl crisis and brought together experts and policymakers to discuss strategies for combating this epidemic, which has wreaked havoc across the United States.

Sen. Mike Crapo emphasized the devastating impact of fentanyl on communities, particularly highlighting a nearly fourteen-fold increase in overdose deaths involving fentanyl in Idaho from 2017 to 2022. He called for a comprehensive approach that addresses both the supply chain of fentanyl and the need for expanded access to mental health and substance use disorder treatments. Crapo also stressed the importance of bipartisan efforts to develop treatment options and reduce barriers to care.

Chairman Ron Wyden focused on integrating healthcare services into the fight against fentanyl. He criticized the high rates of prior authorization required by big health insurers, which delay access to life-saving medication-assisted treatment (MAT). Wyden advocated for better support for individuals reentering society from incarceration and stressed the need for innovative pain management therapies to prevent opioid addiction from developing in the first place.

Dr. Caleb Banta-Green from the University of Washington highlighted the persistent treatment gap in opioid use disorder care. Despite the effectiveness of medications like methadone and buprenorphine, many individuals remain unable to access these treatments. Banta-Green called for a new model of care that combines low-barrier clinical models with community-based access points and team-based care to improve engagement and outcomes for people with opioid use disorder.

Dr. Jeanmarie Perrone from the University of Pennsylvania emphasized the role of emergency departments as critical touchpoints for initiating treatment. She detailed a successful program in Philadelphia where emergency physicians provide immediate access to MAT, supported by peer-led models that help patients navigate their recovery journey. Perrone highlighted the need for telehealth services to continue offering a vital safety net, particularly for individuals reentering the community from incarceration.

Dr. Abigail J. Herron from the Institute for Family Health discussed the importance of integrated, whole-person care models that provide primary care, behavioral health care, and addiction treatment in a single setting. She stressed the need for better reimbursement for case management and preventive mental health services and advocated for maintaining telehealth flexibilities to ensure continued access to care.

Tony Vezina, a person in long-term recovery and Executive Director of 4D Recovery shared his journey and the importance of youth-focused interventions. He highlighted the need for increased investment in prevention, treatment, and recovery support services, particularly for adolescents and young adults. Vezina called for the expansion of recovery centers and recovery residences, as well as greater access to medications for opioid use disorders in various settings, including jails and via telehealth. The hearing underscored the multifaceted approach needed to address the fentanyl crisis, combining supply chain interventions with robust treatment and prevention strategies. Continued collaboration and investment in evidence-based practices are essential to combat this epidemic, and support affected communities nationwide.

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