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Tipping Point: Exploring the Risk of Benefits Cliffs Among Direct Care Workers
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New Study Reveals Financial Pitfalls Facing Virginia’s Direct Care Workforce
A new study released by PositiveAge, a LeadingAge Virginia Foundation, reveals a significant and often hidden financial risk for Virginia’s aging services direct care workers: The Benefits Cliff. The report, Tipping Point: Exploring the Risk of Benefits Cliffs Among Direct Care Workers in Virginia, details findings from a research study led by partner, PHI, a national organization committed to strengthening the direct care workforce by producing robust research and analysis, leading federal and state advocacy initiatives, and designing groundbreaking workforce interventions and models. The Tipping Point report finds that small increases, such as a $5,000 raise, can often lead to a disproportionate loss in public benefits and higher tax burdens. These sudden financial setbacks can leave workers worse off even after receiving a raise, with some facing effective marginal tax rates (EMTRs) of over 100%. The findings from this study spotlight the urgent need for policy reform to ensure higher wages don't come at the cost of essential supports. While PositiveAge prepares for the next phase of work of introducing innovative solutions to combat the benefits cliff issue, LeadingAge Virginia will be advocating for policy solutions in the 2026 General Assembly to stabilize and strengthen this vital workforce.
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