Cornell Study: Private Equity Worsens New York Home Care Conditions

Private equity firms have gained control of half of New York State’s home care sector, driving increased use of automation, managerial neglect, and worker exploitation across an essential public service, according to a study from the Worker Institute at the ILR School at Cornell University.

Private Equity Firms Collect Billions in Medicaid Revenue

New York private equity-backed home care agencies collected $2.32 billion in Medicaid revenue in 2022, representing more than 7.6 percent of the Medicaid home care revenue reported by New York State providers that year, according to the Brooklyn News Service. That revenue influx is projected to climb steeply after private equity gained control of half of the state’s home care market in 2025 and took over administration of the Consumer Directed Personal Assistance Program, which accounted for more than 50 percent of home care delivery in the state.

Private equity firms in New York state promised their investments would improve the industry, but they instead perpetuated poor working conditions marked by low wages, wage theft, managerial negligence, and unsustainable work hours, news.cornell.edu reported.

Private Equity Exploits Marginalized Home Care Workforce

Home care represents the largest occupational category in New York State. In 2023, the state recorded 566,160 home health and personal care aides. Among that workforce, 87 percent were women, 81 percent people of color, and 66 percent immigrants or foreign-born, the Brooklyn News Service reported.

Zoë West, worker rights and equity associate at the Worker Institute, stated that financial actors take advantage of an industry where the workforce is predominantly women of color, devalued, and subject to weak regulation and oversight, according to news.cornell.edu. The report, titled “Private Equity’s Impact on Home Care Workers and Patients in New York State,” notes that ownership changes occur every five years on average, driving instability through leadership churn.

Private equity owners increase automation and technology usage in ways that depersonalize communication between workers and clients. This shift exacerbates managerial neglect, leaving workers isolated when dealing with serious client care problems at home, news.cornell.edu reported. Caregivers described feeling cut off from company support, and some experienced missed or incorrect pay alongside limited health coverage, according to the Brooklyn News Service.

Researchers Propose Policies to Protect Home Care Workers

Researchers from the Worker Institute outlined multiple policy recommendations to address the structural issues identified in the study. These proposals include enacting and fully funding a living wage for home care workers, convening a state task force to establish sustainable working hours, protecting rights to organize, and curbing the extraction of public dollars for private profits, news.cornell.edu reported.

Anne Marie Brady, ILR’s Director of Research for Worker Rights and Equity, criticized the use of taxpayer funds for shareholder gains. Public policies have allowed private financialized actors to provide an essential public service for financial gain, representing an irresponsible use of public dollars, news.cornell.edu reported.

The research forms part of a broader project examining privatization and structural racism in home care.