Feds' new overtime pay rules will affect 500K healthcare workers

The federal government's new rules on overtime pay may have major ramifications for healthcare workers, according to Healthcare Dive.

The final rule, announced this month by the Department of Labor, address employees who work more than 40 hours a week, which will make 4.2 million more Americans eligible for overtime pay, 500,000 of whom work in the healthcare sector. 

The changes, which take effect Dec. 1, leave hospital leaders with four options, Elliot Dinkin, president and CEO of benefits consulting firm Cowden Associate, told the publication: increase salaries to maintain the overtime exemption; pay overtime to workers who qualify; adjust wages; or spread out work hours and workloads. 

Hospitals must work with their legal counsel to help navigate the new regulations, as well as develop a communications plan to respond quickly and accurately to any employee questions or concerns, Dinkin said in the article.

Meanwhile, Gerard Anderson of Johns Hopkins University's Bloomberg School of Public Health told Healthcare Dive that hospitals' labor costs will likely increase as a result of the government regulation. "In the past, people simply worked overtime when there were sick people waiting for care and may not have gotten paid," he told Healthcare Dive. "Now the administrator may have to think twice before asking someone to stay late."

To get out in front of such problems, Dinkin advises hospital leaders to take the following actions: 

  • Create spreadsheets of exempt employees and calculate how much it would cost to give those below the salary threshold a raise.
  • Run a separate analysis to determine the cost of reclassifying such employees to make them overtime-eligible
  • Assess the data, identify and prioritize jobs for further assessment and review job descriptions.

To learn more:
- read the article
- here's the final rule (.pdf)