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LIABILITY ISSUES AFFECTING CONSUMERDIRECTED 
PERSONAL ASSISTANCE 
SERVICES—REPORT AND 
RECOMMENDATIONS 

Charles P. Sabatino, J.D. and Dr. Simi Litvak 

This article explores the legal hurdles which personal assistance services and their 
consumers encounter. The authors detail areas of potential liability faced by the provider 
and recipient of such elder care, including state regulation, tax obligations, licensing, 
respondeat superior issues, tort claims, and sundry consumer options. 
Statutes are critiqued and recommendations presented. 

Table of Contents 

I. Introduction 251 
Charles P. Sabatino, J.D., is Assistant Director of the American Bar Association's 
Commission on Legal Problems of the Elderly, and manages research, project development, 
and education in areas of health law, long-term care, decision making, 
and legal services delivery for the elderly. He is also a part-time Adjunct Professorat Georgetown University Law Center, where he teaches Law and Aging, and a 
member of the Board of the National Academy of Elder Law Attorneys. He received 
his J.D. from Georgetown University Law Center and is a member of the 
Virginia and D.C. bars.

Simi Litvak, Ph.D., is Research Director of the World Institute on Disability'sResearch and Training Center (RTC) on Personal Assistance Services and of the 
RTC on Independent Living and Disability Policy. Dr. Litvak served on the President's 
Health Care Reform Task Force. She received an M.A. and Ph.D. in Behavior 
Disabilities from the University of Wisconsin at Madison.

In an attempt to address the liability concerns of all these competing groups 
and develop clear policy direction for advocates around these issues, the PersonalAssistance Services Task Force of the Consortium for Citizens with Disabilities 
formed a subcommittee on liability and asked the American Bar Association'sCommission on Legal Problems of the Elderly (ABA Commission) to work with 
the World Institute on Disability (WID). The ABA Commission had previouslyexamined some of the legal impediments to consumer-driven PAS programs. It 
became clear early on that it would take more effort than a task force could pro



248 The Elder Law Journal 

II. What Are Consumer-Directed Personal Assistance 
Services? 254 

A. Role of Surrogates 256 

B. Delivery Models 257 

III. Employer v. Independent Contractor Relationships 258 

IV. What Is Meant by Liability ? 

V. Employment Tax and Benefit Liability 261 

A. Withholding/Reporting Federal Income Tax 263 

1. Legal Source 263 

2. Nature of Responsibility 263 

3. To Whom the Responsibility Applies 264 

4. Key Exception—Domestic Service in Private 
Home 265 

5. Penalties for Noncompliance 265 

6. Potential Role for Intermediary Agency 266 

7. Special Issue: Is a Cash Grant Income? 266 

B. Social Security and Medicare Tax (FICA) 267 

1. Legal Source 267 

2. Nature of Responsibility 268 

3. To Whom the Responsibility Applies 268 

4. Thresholds/Key Exceptions 268 

5. Penalties for Noncompliance 269 

6. Potential Role for Intermediary Agency 269 

7. Case Law 270 

C. Federal and State Unemployment Tax 270 

1. Legal Source 270 

2. Nature of Responsibility 270 

3. To Whom the Responsibility Applies 271 

4. Thresholds/Key Exceptions 272 

5. Penalties for Noncompliance 272 

6. Potential Role for Intermediary Agency 272 

7. Case Law 273 

vide in order to do the research needed on this topic. Fortunately, the Retirement 
Research Foundation was kind enough to provide WID with funds for this project.
Charles P. Sabatino, of the ABA Commission, performed the primary legal 
research and analysis under contract with WID. Simi Litvak, of WID, provided thediscussion of PAS programs and collaborated on the report's conclusions and recommendations. 
The analysis, findings, and recommendations rest in part on a review 
of these issues undertaken by a round table consisting of 25 invited legalexperts, state agency and program administrators, policy researchers, and PAS 
consumers. The round table, sponsored by WID and the ABA Commission, washeld on September 23, 1994, in Washington, D.C. 


PAS LIABILITY ISSUES 249 

D. Minimum Wage and Overtime Pay Requirements 274 

1. Legal Source 274 

2. Nature of Responsibility 274 

3. To Whom the Responsibility Applies 274 

4. Thresholds/Key Exceptions 275 

5. Penalties for Noncompliance 277 

6. Potential Role for Intermediary Agency 277 

7. Special Issue-Companionship Exemption 277 

8. Special Issue-Paying Live-Ins 283 

E. Verifying Citizenship or Legal Alien Status 286 

1. Legal Source 286 

2. Nature of Responsibility 286 

3. To Whom the Responsibility Applies 286 

4. Thresholds/Key Exceptions 287 

5. Penalties for Noncompliance 287 

6. Potential Role for Intermediary Agency 288 

7. Case Law 288 

F. Workers' Compensation 288 

1. Legal Source 288 

2. Nature of Responsibility 288 

3. To Whom the Responsibility Applies 289 

4. Thresholds/Key Exceptions 289 

5. Penalties for Noncompliance 290 

6. Potential Role for Intermediary Agency 290 

7. Case Law 291 

G. State Disability Insurance Taxes 292 

1. Legal Source 292 

2. Nature of Responsibility 292 

3. To Whom the Responsibility Applies 292 

4. Thresholds/Key Exceptions 293 

5. Potential Role for Intermediary Agency 293 

H. Discussion and Recommendations 293 

1. Current Law 293 

2. Recommendations on Employment Tax and 
Benefit Liability Issues 296 

VI. Personal Injury Liability 298 

A. Tort Law and Bases for Provider Negligence 299 

1. Personal Liability 300 

2. Direct Corporate Liability 300 

3. Vicarious Liability 300 


250 The Elder Law Journal 

a. Respondent Superior 

b. Apparent or Ostensible Agency 

B. Cases 

1. Reported Decisions 

2. Trial Litigation 

a. Gus tin v. Physicians Home Service 

b. Plaintiff v. Defendant 

c. Gaylord v. Oxford Health Care 

d. Fink, Jr. v. Kimberly Services, Inc. 

e. Dickman v. City of New York 

301 
301 
302 
302 
306 
306 
306 
306 
307 
307 

f. Ready v. Personal Health Care Services Corp. & 
Community Psychiatric Centers 307 

g. Jones v. UpJohn Healthcare Services 308 

h. Tomlinson v. Underhill Personnel Service 308 

C. Assumption of Risk 309 

D. Informed Consent 310 

E. Consumer Negligence 314 

F. Other Tort Issues 315 

G. Workers' Compensation 317 

H. Discussion and Recommendations 319 

I. Recommendations on Personal Injury Liability 
Issues 321 

VII. Licensure and Certification Liability 321 

A. Nurse Practice Acts 323 

1. Survey of Acts 324 

2. Findings 326 

a. Exemption—Care Provided by Friends and 
Family 326 

b. Exemption—Care Provided by Domestic 
Servants 327 

c. Exemption—Domestic Administration of 
Family Remedies 330 

d. Exemption—Care by an Employee of an 
Institution 330 

e. Exemption—Care Provided Under the 
Direction of a Registered Nurse 

 330 

f. Exemption—Care Under the Order of a 
Licensed Physician or Other Personnel 333 

3. Discussion and Recommendations 334 

B. Licensure Issues and Recommendations 339 


PAS LIABILITY ISSUES 251 

1. Recommendations for Regulatory Liability 
(Nurse Practice Acts) 339 
2. Licensure Issues 339 
3. Recommendations on Agency Licensure 342 
VIII. Summary of Findings and Recommendations 343 
A. Personal Injury Liability 343 
1. Risk Apportionment 343 
a. Findings 343 
b. Recommendations 343 
2. Injury to PAS Workers 344 
a. Findings 344 
b. Recommendation 344 
B. Licensure and Certification Liability 344 
1. Nurse Practice Acts 344 
a. Findings 344 
b. Recommendations 344 
2. Intermediary Agency Regulation 345 
a. Findings 345 
b. Recommendations 345 
I. Introduction 
In the area of personal assistance services (PAS), 
there are two major policy issues, cost and program design.' Liability 
is integrally involved in both these issues. "Liability" includes a broad 
range of torte and regulatory3 obligations and issues. Legal obligations 
and liabilities affect the delivery of PAS in profound ways and 
with differing consequences depending upon one's role as a consumer, 
service provider, service sponsor, payer, or regulator. 

Since the late 1980s, the independent living/disability rights 
movement has been pushing for maximum consumer control in the 
delivery of PAS for those who want such control and who are capable 
of managing it themselves or with the assistance of a surrogate or "cir


1. The two issues are related to the extent that service delivery models vary 
in their cost per hour. This raises issues of cost effectiveness, i.e., for which populations 
are differing models of PAS more effective. 
2. Tort law liability involves personal injury to either the consumer or the 
worker due to negligence or intentional tort.
3. Regulatory liability involves the applicability of nurse practice acts and 
provider licensure and certification requirements. 

252 The Elder Law Journal 

cle of friends."4 In addition, independent living activists want their 
personal assistants (PAs) to be able to perform invasive, "paramedical 
tasks" which are part of a daily routine in the life of some personal 
assistance users, such as taking medication, administering injections, 
cleaning and replacing catheters, and maintaining respiratory equipment.' 
Consumers are also interested in shifting cost savings from 
more paternalistic, medical-model programs into more consumer-
driven program models so that PAs can have higher pay and benefits 
and the service system can be expanded. 6 Consumers and administrators 
are convinced that higher pay and benefits would increase the 
number of people choosing this kind of work and make it possible for 
consumers to terminate undesirable PAs without being afraid that a 
new PA would not be found.' 

When advocates began pressing for greater consumer control 
over PA selection, hiring, payment, tasking, training, supervision, and 
termination, state administrators of PAS programs often invoked concerns 
over liability as the reason why consumer direction and control 
could not be realized in PAS program design.' State government officials 
are concerned that they could be forced to pay damages in personal 
injury lawsuits for injuries caused by independent providers 
over whom the state has little control, even though research has 
shown that very few such lawsuits have been pursued. 9 Also, in 
many states, nurse practice acts prohibit paid, unlicensed personal 

4. SIMI LITVAK ET AL., WORLD INST. ON DISABILITY, AI TENDING TO AMERICA: 
PERSONAL ASSISTANCE FOR INDEPENDENT LIVING: A SURVEY OF ATTENDANT SERVICE 
PROGRAMS IN THE UNITED STATES FOR PEOPLE OF ALL AGES WITH DISABILIUES 9-17 
(1987). See generally THE CONSORTIUM FOR CITIZENS WITH DISABILITIES TASK FORCE 
ON PERSONAL ASSISTANCE SERVS., RECOMMENDED FEDERAL POLICY DIRECTIONS ON 
PERSONAL ASSISTANCE SERVICES FOR AMERICANS WITH DISABILITIES (1992); WorldInst. on Disability, International Personal Assistance Services Symposium, Resolution 
on Personal Assistance Services (1991), in RESEARCH & TRAINING Cm. ON DISABILITY, 
PERSONAL ASSISTANCE SERVICES: A GUIDE TO POLICY AND ACTION (1991). 
5. HALE ZUKAS, WORLD INST. ON DISABILITY, ATTENDANT SERVS., PARAMEDICAL 
SERVS. & LIABILITY ISSUES, STATEMENT TO THE NEW MEXICO GOVERNOR'S COMMITTEE 
ON THE CONCERNS OF THE HANDICAPPED 1-4 (1986). 
6. See LANCE EGLEY, WORLD INST. ON DISABILITY, THE COST OF A NATIONAL 
SYSTEM OF PERSONAL ASSISTANCE SERVICES 12 (1994); Andrew I. Batavia et al., Toward 
a National Personal Assistance Program: The Independent Living Model of Long-
Term Care for Persons with Disabilities, 16 J. HEALTH PoL' y & L. 523 (1991). 
7. CHARLES P. SABATINO, AMERICAN BAR ASS'N, LESSONS FOR ENHANCING 
CONSUMER-DIRECTED APPROACHES IN HOME CARE 23-24, 40-41 (1990). 
8. Charles P. Sabatino & Simi Litvak, Consumer-Directed Homecare: What 
Makes It Possible?, GENERATIONS, Winter 1992, at 53, 54. 
9. Marshall B. Kapp, Improving Choices Regarding Home Care Services: Legal 
Impediments and Empowerments, 10 ST. Louis U. PUB. L. REV. 441 (1991). 

PAS LIABILITY ISSUES 253 

assistance providers from performing invasive, paramedical tasks.w 
States are concerned that people with disabilities face great risks when 
they receive such services from unsupervised people who have no formal 
medical training.11 

This article comes out at a propitious juncture in the debate over 
cost and delivery models. Policy makers, advocates, government officials, 
service providers, and researchers in the aging arena over the 
past few years have expressed greater interest in exploring consumer-
directed PAS (CD-PAS) models. 12 Similarly, the Home of Our Own 
projects and supported living are becoming the new direction for people 
with developmental and related disabilities. w Federal officials responded 
to these developments and the need to search for ways to 
provide more cost-effective long-term services. Although community-
based long-term services are generally much less costly on an individual 
basis than are institutional services, it is not clear whether an expansion 
of home and community-based services saves any money in 
the aggregate. It depends upon what populations are targeted and the 
kinds of costs included in the calculation.14 

Federal policy makers continue to search for more cost-effective 
models and are beginning to consider the use of direct cash payments 
and vouchers as an alternative to home-care agencies, models which 
many disability activists have found to be more desirable.'5 There has 
been increasing interest in innovative European models in this regard. 
16 Such models offer substantial consumer direction and control, 

10. See section VII of the article. 
11. See section VII of the article. 
12. See ROSALIE A. KANE, UNIV. MINN., QUALITY, AUTONOMY, AND SAFETY IN 
HOME AND COMMUNITY-BASED LONG-TERM CARE: TOWARD REGULATORY AND QUALITY 
ASSURANCE POLICY 7-8 (1995); HUMPHREY TAYLOR ET AL., THE COMMONWEALTH 
COMM'N ON ELDERLY PEOPLE LIVING ALONE, THE IMPORTANCE OF CHOICE IN MEDICAID 
HOME CARE PROGRAMS: MARYLAND, MICHIGAN, AND TEXAS 1-2 (1991); Lori 
Simon-Rusinowitz & Brian F. Hofland, Adopting a Disability Approach to Home Care 
Services for Older Adults, 33 GERONTOLOGIST 159 (1993). 
13. See generally JULIE A. RACINO & SUSAN O'CONNOR, CHALLENGES FOR A SERVICE 
SYSTEM IN TRANSITION: INSURING A QUALITY COMMUNITY EXPERIENCE FOR PERSONS 
WITH DEVELOPMENTAL DISABILITIES (Mary F. Hayden & Brian H. Abery eds., 
1993); Jay Klein, Get Me the Hell Out of Here—Supporting People with Disabilities to 
Live in Their Own Homes, in NATURAL SUPPORTS IN SCHOOL, AT WORK AND IN COMMUNITY 
FOR PEOPLE WITH SEVERE DISABILITIES (Jan Nisbet ed., 1992). 
14. ALICE M. RIVLIN & JOSHUA M. WIENER, CARING FOR THE DISABLED ELDERLY: 
WHO WILL PAY? 190-92 (1988). 
15. See, e.g., Health Security Act, S. 1757, 103d Cong., 1st Sess. (1994). 
16. KATHY A. CAMERON & JAMES P. FIRMAN, INTERNATIONAL AND DOMESTIC 
PROGRAMS USING "CASH AND COUNSELING" STRATEGIES TO PAY FOR LONG-TERM 

254 The Elder Law Journal 

and they are considerably less costly. 17 It is hoped that this article will 
contribute to the process of developing cost-effective, CD-PAS in the 
United States. 

II. What Are Consumer-Directed Personal Assistance 
Services? 
PAS is a broad term meant to encompass a wide variety of services. 
These services are referred to by many names: personal care, in-
home supportive services, home care, chore services, homemaker 
services, companion services, and attendant care." Although meanings 
may vary by state or locale, collectively, these services include 
hands-on and standby assistance, supervision, or cueing with a broad 
array of activities: personal or bodily care functions, traditionally referred 
to as activities of daily living (ADL); and meal preparation, 
laundry, light housekeeping, handling money, shopping, and transportation 
activities, traditionally referred to as instrumental activities 
of daily living (IADL). 19 Even reader services for blind persons and 
interpreter services for deaf persons may be included within this concept.
20 Recipients of these services include people with physical, sensory, 
cognitive, and psychiatric disabilities of all ages.21 

Approaches to PAS that may be referred to as "consumer directed" 
are quite fluid and ill-defined, especially with respect to older 
consumers. State experience with consumer-directed models is still in 
infancy and likely to undergo substantial evolution, especially if national 
or state health reform efforts produce new home and community-
based service opportunities with a priority on consumer choice. 

The starting point for consumer-directed models has been the 
independent-living model, as developed by disability advocates in the 
1970s.22 Originally, the independent-living movement demanded that 
consumers be responsible for all management functions. Under this 
model, the disabled person is considered an active recipient of serv-

CARE (1995); WORLD INST. ON DISABILITY, U.S./EUROPEAN PAS ADAPTATION AND 
REPLICATION Krr (1995). 

17. See CAMERON & FIRMAN, supra note 16. 
18. LrrvAK ET AL., supra note 4, at 9-17; Hadley D. Hall, Paraprofessionals: Their 
Role & Definition in Home Health Care, GENERATIONS, Winter 1986-87, at 27. 
19. Gerben DeJong et al., The Independent Living Model of Personal Assistance in 
National Long-Term-Care Policy, GENERATIONS, Winter 1992, at 90. 
20. Id. 
21. Id. 
22. Id. at 89-90; see also Batavia et al., supra note 6, at 523. 

PAS LIABILITY ISSUES 255 

ices and recruits, selects, trains, manages, and directs his or her own 
services provider, known as a PA. The recipient is a "consumer" of 
services, not a "patient." The PA is accountable to the consumer, not 
to a supervising nurse or agency. The worker acts, in effect, as an 
extension of the disabled person and follows that person's directions 
as to how to meet his or her needs." This model differs significantly 
from both the "medical" model of care and "informal" model of care 
in matters of control and formality." 

CD-PAS may be viewed along a continuum of consumer control. 
A "pure" CD-PAS model would pay a cash benefit to the consumer for 
the consumer to purchase whatever service or assistance he or she 
determines is appropriate and desirable. However, consumers vary 
widely in their ability and desire to self-manage care. Because of this 
reality, CD-PAS appear in many shades of gray depending upon the 
nature and extent of support needed by the consumer. The variations 
recognize, implicitly or explicitly, that many consumers need or want 
variable levels of support in managing their assistance. Support 
wanted or needed may be merely in handling the bookkeeping elements 
of employing PAs; or it may be helpful in recruiting and screening 
PAs; or it may be helpful in several components, such as 
recruiting, selecting, training, paying, or directing PAs. Although examples 
of supportive models exist, no clear continuum of supportive 
models has been defined. 25 This article will attempt to describe the 
main elements of a continuum. 

In considering an outside limit of consumer-directed services, it 
is not clear at what point a PAS delivery model is no longer a consumer-
directed model and, instead, an agency-directed model. Of 
course, principles of consumer direction have a role even in traditional 
agency-provider models. All services should provide meaning


23. DeJong et al., supra note 19, at 90. 
24. Id. In somewhat oversimplified terms, these models may be described asfollows: Under the informal support model, the individual's family or support 
network provides the individual's support services informally, without regulation 
or compensation. The caregiver largely determines what care or service the individual 
will receive. Under the medical model, the provider is a "professional" 
who is directly accountable to the payer—the government agency or insurancecompany, not the recipient—for the care or service provided. The recipient of 
services is viewed as a passive, non-self-directed individual who requires professional 
supervision. 
25. For a description of 16 programs varying in opportunities for and supportof consumer direction, see SIMI LITVAK ET AL., WORLD INST. ON DISABILITY, FINAL 
PERFORMANCE REPORT NEW MODELS FOR THE PROVISION OF PERSONAL ASSISTANCE 
SERVICES, APPENDIX C: SOURCE BOOK OF CASE STUDY INFORMATION (1990). 

256 The Elder Law Journal 

ful choices and respect for consumer control. However, some 
operational threshold of choice and control would be helpful to identify 
as the earmark of CD-PAS, so that the legal and regulatory issues 
can be more clearly identified and addressed. 

In several of the national health reform proposals of 1994, including 
President Clinton's ill-fated Health Security Act, "consumer 
directed," with reference to PAS, was defined as "services that are provided 
by an individual who is selected and managed (and, at the individual's 
option, trained) by the individual receiving services."26 The 
definition is ambiguous because neither selection nor management are 
all or nothing functions. If the choice of worker is limited to a few 
agency-approved individuals, is that a meaningful selection? If the 
consumer handles some management tasks such as scheduling and 
assigning tasks) while a case manager handles other tasks (such as 
supervision, monitoring, and approval of payment), does such a division 
of function amount to "consumer directed?" 

In important respects, consumer direction is a philosophy and 
orientation to service delivery, rather than a particular identifiable 
type of care. It consciously minimizes a paternalistic "medical" or 
"professional" orientation toward supportive services and emphasizes 
individual autonomy and support of individual preference. Consumer 
direction may exist in differing degrees and may span many 
types of service. For purposes of the following analysis, "consumer 
directed" will mean PAS in which consumers, or their surrogates, exercise 
substantial control over (1) selecting providers of services, (2) 
determining the tasks and the way they are to be done, (3) determining 
the timing and distribution of hours, and (4) supervising, and if 
desired, terminating the worker. 

A. Role of Surrogates 
The potential role of surrogates in this working definition of consumer 
direction is significant. In this report, the term "consumer" is 
meant to include any legally authorized surrogate chosen by the consumer 
to serve as a manager of his or her services. The ability to 
choose a surrogate or proxy—usually a family member or friend— 
significantly expands the potential collection of disabled persons who 
may avail themselves of a CD-PAS option. Consumer direction, by 
means of a proxy appointed by the consumer, should be a viable op


26. Health Security Act, S. 1757, 103d Cong., 1st Sess. § 2104(g)(2) (1994). 

PAS LIABILITY ISSUES 257 

tion for individuals who cannot self-direct their care. However, the 
practical risks and benefits of this kind of arrangement have not been 
adequately studied. 

The appointment of a proxy may occur through the use of durable 
power of attorney for health care, recognized in every state, and 
possibly by means of less formal instructions given by the recipient of 
services and documented by the PAS program. The degree of formality 
required depends on an assessment of the particular state's surrogate 
decision-making laws.27 

It is not entirely clear whether other forms of legal surrogacy, not 
chosen by the consumer, can or should be relied upon in consumer-
directed care models. For example, family members or close friends, 
not expressly chosen by the individual, may be authorized under state 
law to act as default decision makers for purposes of health-care decisions.
28 Likewise, court-appointed guardians and conservators may 
have authority to make decisions on behalf of the service recipient, 
and, in fact, may be directing the services of their ward. 29 However, if 
the individual receiving services lacks even the capacity to appoint a 
surrogate, it is difficult to include these cases within the concept of 
consumer direction. 

B. Delivery Models 
In a ten-state survey of CD-PAS, Susan Flanagan identified four 
delivery models of PAS based on the identity of the employer: 

(1) state or local government as the employer; 
(2) an intermediary agency as the employer; 
(3) the consumer as the employer; 
(4) the consumer as the employer, but with the state or local government 
or intermediary agency acting as an agent of the consumer 
for employment tax purposes.3° 
None of the states she surveyed used the first model, presumably 
because it is the most expensive option for state and local govern


27. See Charles Sabatino, Legislative Trends in Health-Care Decisionmaking, 
BIOETHICS BULL., Summer 1994, at 10. 
28. Id. at 10-11. 
29. Susan Miler & Sally B. Hurme, Guardianship Monitoring: An Advocate's 
Role, 25 CLEARINGHOUSE REV. 654, 656-58 (1991). 
30. SUSAN FLANAGAN, CONSUMER-DIREC ED ATTENDANT SERVICES: How 
STATES ADDRESS TAX, LEGAL AND QUALITY ASSURANCE ISSUES 19 (1994). 

258 The Elder Law Journal 

ments.31 Based on Flanagan's program descriptions, one might also 
suggest a fifth, albeit legally questionable, mode: 

(5) the PA as independent contractor. 
The Nebraska Home Care Program, described by Flanagan, appears 
to claim this mode1. 32 Other states not surveyed by Flanagan 
have similarly claimed it. For example, Virginia, until recently, took 
the position that under its county-based "Companion Service Program," 
the individuals who provide PAS, as well as chore, companion, 
and homemaker services, were independent contractors. The 
program paid workers less than minimum wage and provided no 
payment of income, Social Security, or other employment benefits. 
However, effective December 1994, under an agreement with the Internal 
Revenue Service, the state now considers the companions employees 
of the consumer and the local department of social services a 
"fiscal agent" for purposes of paying the companions. Companions 
now receive at least minimum wage, and Social Security and unemployment 
taxes are withheld and reported. 33 For reasons elaborated 
below, we conclude that an individual providing PAS, and especially 
CD-PAS, cannot be an "independent contractor." 

III. Employer v. Independent Contractor Relationships 
The legal responsibilities discussed in this article arise primarily 
from the existence of an employer-employee relationship. If the PAS 
worker is an "independent contractor" rather than an "employee," 
most of the legal responsibilities do not apply to the consumer or to 
the state or local government operating the PAS program. Instead, the 
worker, as self-employed, fends for himself or herself.34 

The status of "employer" is, at its heart, a legal fiction, representing 
a societal judgment about who should be responsible for certain 
work-related taxes, benefits, liabilities, and reporting obligations. 

31. Id. 
32. Id. at 20. 
33. Letter from Terry A. Smith, Adult Services Program Manager, Virginia 
Department of Social Services, to author (Aug. 10, 1995) (on file with author). 
34. Steven M. Burke, Implication of IRS Recharacterization of Independent Contractors 
as Employees, 64 N.H. B.J. 307-13 (1992); Mark A. Coel, Distinguishing Independent 
Contractors from Employees, FLA. B.J., Mar. 1993, at 47-51; Cliff E. Spencer, 
Comment, Oregon's Independent Contractor Statute: A Legislative Placebo for Employers, 
31 WILLAMETTE L. REV. 647 (1995). 

PAS LIABILITY ISSUES 259 

That party is deemed an "employer."35 The criteria for determining 
whether an employment relationship or, in the alternative, an "independent 
contractor" relationship exists, vary under different statutes 
and different contexts. 36 Thus, one must constantly ask: 
"Employer for what purpose?" Indeed, in evaluating public policy, it 
may be more effective simply to unbundle the notion of employer into 
the specific rights and responsibilities that are relevant to PAS and 
then to consider how these legal responsibilities may be fairly and 
practically apportioned among the parties involved in the particular 
PAS program. 

But even given the variations that exist in consumer direction, 
the operation of PAS necessarily concedes a level of consumer or 
agency control that most certainly establishes an employer-employee 
relationship under virtually any definition. This is especially true in 
so-called CD-PAS models, for to conclude otherwise is to contradict 
the very notion of consumer direction. 

If one accepts the conclusion that the PA must be an employee, 
then the question becomes: Who is the employer? Is it the consumer, 
the government, or a public or private agency that sponsors or pays 
for the service? The answer we choose has tremendous consequences. 

Generally, states do not want to assume the employer status of PAs. 
They perceive tremendous cost consequences in these obligations and 
liabilities. From the state's fiscal point of view, states typically assume 
that the employer role results in multiple liabilities which in turn result 
in substantially increased cost. For state and local governments, 
these costs and additional overhead are perceived as prohibitive.37 

In contrast, it is often argued that if consumers assume the employer 
role, the public cost will be substantially cheaper; 38 although 
the validity of that perception deserves challenge. Although some reduction 
in cost is likely through lower overhead, much of the cost 
differential in "consumer-directed" programs has existed in large part 
because of substantial undercompensation of PAS workers. Litvak 
and Kennedy found in a study of 133 PAS programs in 1988 in the 
United States that individual PAS providers were paid at or just above 

35. Burke, supra note 34, at 307-13; Coel, supra note 34, at 47-51; Spencer, supra 
note 34, at 647. 
36. Burke, supra note 34, at 307-13; Coel, supra note 34, at 47-51; Spencer, supra 
note 34, at 647. 
37. SABA-nrsio, supra note 7, at 16-19. 
38. Id. 

260 The Elder Law Journal 

minimum wage and were covered, on average, by only one employee 
benefit, namely Social Security. 39 Moreover, many indirect costs may 
be overlooked. For example, what is the cost to the state for health 
and social service benefits that PAS workers may utilize because they 
as a group are financially disadvantaged?40 

Despite the pressure to avoid the employer role, states clearly do 
not wish to avoid all accountability. They are concerned about program 
dollars spent, quality of care, and protection of PAS consumers, 
especially consumers with questionable capacity to manage their own 
affairs. Some states have sought to provide some support and oversight 
directly or through designated agencies. But they have sought 
to avoid being deemed the "employer" of the PA and thus vested with 
authority over the PA and responsible for a variety of employer obligations 
and liabilities. 41 Where and how to draw the line on responsibility 
has been their quandary. 

Unlike simple employment situations involving two parties— 
employer and employee—publicly funded PAS programs typically involve 
three or four parties: the consumer, the individual provider, the 
payer or regulator of the program, and sometimes an intermediary 
private agency. Conventional tort law is not well adapted to such service 
configurations. Similarly, regulatory issues in long-term care 
have historically focused on institutional care and medical services, 
not on home "help" services. Recommendations made in this article 
will focus both on programmatic options that states may use to meet 
legal requirements and on public policy changes that are needed to 
encourage the development of effective CD-PAS models. 

IV. What Is Meant by Liability? 
"Liability" is a broad and often loosely used term. In a narrow 
sense, we think of liability in the context of tort law: negligence and 
malpractice for example. In its generic sense, liability has been de


39. SIMI LITVAK & JAE KENNEDY, WORLD INST. ON DISABILITY, POLICY ISSUES 
AND QUESTIONS AFFECTING THE MEDICAID PERSONAL CARE SERVICES OPTIONAL BENE-
Frr 29-30 (1991). 
40. See William H. Crown, A National Profile of Homecare, Nursing Home, and 
Hospital Aides, GENERATIONS, Fall 1994, at 29. 
41. For several state program descriptions, see SIMI LITVAK & JAE KENNEDY, 
WORLD INST. ON DISABILITY, CASE STUDIES OF SIX STATE PERSONAL ASSISTANCE SERVICE 
PROGRAMS FUNDED BY THE MEDICAID PERSONAL CARE OPTION 6 (1991); SIMI 
LITVAK Er AL., supra note 25; and SABATINO, supra note 7, at 45-141. 

PAS LIABILITY ISSUES 261 

fined as "the condition of being actually or potentially subject to an 
obligation."42 For purposes of PAS, liability concerns may be broken 
down into three broad areas, each with components that will be examined 
in the following sections. 

(1) Employment Tax and Benefit Liability: recognition of basic 
employment responsibilities (e.g., income tax reporting, Social Security 
payment, and federal and state unemployment insurance and 
workers' compensation); 
(2) Personal Injury Liability: personal injury to the consumer or 
worker due to negligence or intentional tort; and 
(3) Licensure and Certification Liability: the application of law 
and regulations that control the nature and quality of health and long-
term care services—specifically, nurse practice acts and provider certification 
requirements. Regulatory concerns embody a fundamental 
conflict between safety and quality assurance values on one hand and 
consumer autonomy on the other. 
V. Employment Tax and Benefit Liability 
All the duties below apply to employer-employee relationships, 
but not to independent contractors43 as defined by the particular law. 
As previously explained, personal attendants and other domestic 
workers are almost always considered employees under the applicable 
tests. However, if the personal assistant is employed by an 
agency, the agency and not the consumer bears such responsibilities.44 
Table 1: Employer Obligations Summary summarizes the legal responsibilities 
described in sections V.A through V.G. These responsibilities 
include: withholding and reporting income taxes, Social 
Security (FICA), unemployment taxes, minimum wage and overtime, 
workers' compensation, and in a few states, disability insurance 
taxes.45 

42. BLACK'S LAW DICTIONARY 914 (6th ed. 1990).
43. See supra part III for explanation of the distinction between employer-
employee relationship and an independent contractor relationship. 
44. See discussion supra part III.
45. For the federal legal bases of these responsibilities, see I.R.C. §§ 3401-3406,3507 (1994) (collection of income tax and earned income credit); see also Federal 
Insurance Contribution Act (FICA), I.R.C. §§ 3101, 3102, 3121 (1994) (regarding tax 
on employees, tax on employers, and definitions); Federal Unemployment Tax Act(FUTA), I.R.C. §§ 3301-3311; Fair Labor Standards Act (FLSA), I.R.C. § 201 (minimum 
wage and overtime); Federal Employees' Compensation Act (FECA), 5
U.S.C. § 8101 (1994) (workers' compensation). 

262 The Elder Law Journal 

Recently, these employment tax responsibilities for employers of 
domestic workers in a private home have been substantially changed 
because of the Social Security Domestic Employment Reform Act of 
199446 (SSDERA). Popularly known as the "nanny tax" reform bill, 
SSDERA was signed by President Clinton on October 22, 1994. 47 The 
law is designed to simplify the payment of employment taxes for domestic 
workers. It raises the threshold for withholding and paying 
Social Security taxes to $1,000 annually, effective 1994 (to be indexed 
annually starting in 1996).48 It also provides that, beginning in 1995, 
individuals who employ only domestic workers will no longer be required 
to file quarterly forms and payments for Federal Insurance 
Continuation Act (FICA), federal unemployment taxes, and any 
agreed-upon federal income tax withholding. Instead, these wages 
and withholdings will be included in the employer's own annual personal 
income tax return (Form 1040). 49 However, since 1988, such employers 
have had to increase the withholdings from their own wages 
(or increase their quarterly estimated tax payments) to account for employment 
taxes owed on domestic workers:6° Specific changes 
brought about by SSDERA are elaborated in the relevant sections 
below.51 

In order to fulfill any employer obligations explained below, the 
individual employing an attendant needs an employer identification 
number (EIN). This may be obtained by sending a completed IRS 
Form SS-4 (Application for Employer Identification Number) to the 
IRS. Alternatively, the employer may simply write "None" in the 
space provided for the EIN on the first employment tax form filed. 
The IRS will then assign the employer a number. A separate state EIN 
may also be required.52 

46. Social Security Domestic Employment Reform Act of 1994, Pub. L. No.
103-387, 108 Stat 4071 (codified as amended in scattered sections of 26 U.S.C.). 
47. Id. 
48. Id. § 3121(x). 
49. Id. § 3510(a). 
50. Id. § 3110(b). 
51. See Impact of the Nanny Tax Act on Reporting and Paying Taxes for Domestic 
Workers in 1994 and Beyond, Stand. Fed. Tax Rep. (CCH) (1111 48,633-648, at 79,541-42(1994) [hereinafter Nanny Tax]; Rev. Proc. 95-18, 1995-17 I.R.B. 13. 
52. Nanny Tax, supra note 51, 11 48,637. 

PAS LIABILITY ISSUES 263 

A. Withholding/Reporting Federal Income Tax 
1. LEGAL SOURCE 
The relevant federal income tax provisions are found at 26 U.S.C. 
§§ 3401-3406 (collection of income tax) and § 3507 (earned income 
credit), as amended by the SSDERA. The majority of all states, cities 
and localities that impose a personal income tax follow the federal 
income tax requirements regarding the types of payments from which 
tax must be withheld. 53 SSDERA amendments change the federal 
threshold amount for paying and reporting taxes (effective 1994) and 
the procedures for reporting (effective 1995). States will probably follow 
suit and conform to the new federal requirements. 

2. NATURE OF RESPONSIBILITY 
Employers must withhold and report federal income taxes, 
although the exception described below makes withholding optional 
for "domestic service [provided] in a private home."54 Through 1994, 
withheld income taxes were paid to the IRS on a quarterly basis using 
IRS Form 942 (the same form used to transmit FICA payments).55 
However, for domestic services rendered after January 1, 1995, SSDERA 
of 1994 permits an employer who opts to withhold income 
taxes to pay them as part of the employer's individual tax return 
(Form 1040) annually, instead of quarterly.56 

Even where income tax is not withheld, employers still must report 
worker income annually. There is no domestic service exception, 
and SSDERA does not change this. 57 The employer must provide employees 
with Form W-2 (Wage and Tax Statement) for the calendar 
year by January 31 of the following year.58 

A related income tax responsibility concerns the earned income 
credit (EIC). Employers must make advance payments of a portion of 
the EIC to qualified employees who request advance payment.59 An 
employee age twenty-five through sixty-four, with a family income of 
less than an annually adjusted amount ($24,396 in 1995) 6° may qual


53. Id. 48,643. 
54. I.R.C. § 3401(a)(3) (1994). 
55. Nanny Tax, supra note 51, ¶ 48,639. 
56. I.R.S. Notice 95-18, 1995-17 I.R.B. 13; Nanny Tax, supra note 51, 48,639. 
57. Nanny Tax, supra note 51, 48,639. 
58. INTERNAL REVENUE SERV., DEPARTMENT OF THE TREASURY, PUB. No. 15, CIRCULAR 
E, EMPLOYER'S TAX GUIDE 2 (1996).
59. I.R.C. § 3507 (1994). 
60. Joint Committee on Taxation Staff Description of Present Law and Analysis Relating 
to Earned Income Credit and Child Tax Credit as Contained in Budget Reconcilia

264 The Elder Law Journal 

ify.6' The size of the credit depends on the worker's income and 
number of children. Employees without children may also claim the 
EIC, if they are over age twenty-four and over age sixty-five with income 
less than $9,230 (although they are not entitled to advance payment 
of the EIC).62 

Given the demographics of personal assistance workers, the EIC 
may have wide applicability. The maximum credit for 1995 is $2,094 
for an employee with one child and $2,592 for an employee with two 
or more children.63 Sixty percent of the maximum may be paid in 
advance. 64 The employer must notify the employee that he or she 
may be eligible for the EIC, regardless of whether federal income taxes 
are withheld. 65 If a qualified employee requests advance payment (by 
completing Form W-5, Earned Income Credit Advance Payment Certificate 
each year), then the employer must pay the employee a portion 
of the credit amount in each paycheck for that year. 66 The employer is 
indirectly "reimbursed" by the IRS by being permitted to deduct the 
amounts paid from income tax withholdings or FICA that would 
otherwise be paid to the IRS. Such payments are normally reported 
on the quarterly Form 942 and the annual Form W-2. 67 As of January 
1995, because the employer of domestic services need make only an 
annual payment of employment taxes, the offsetting of EIC already 
advanced to the worker will not occur until the tax year has been completed 
and employment taxes are paid to the IRS.68 

3. TO WHOM THE RESPONSIBILITY APPLIES 
The responsibility to withhold and report income tax applies to 
any "employer" paying "wages."69 "Employer" is defined as "the person 
for whom an individual performs or performed any service, of 
whatever nature,"70 but if the person does not have control of the pay


tion Bill (HR 2491), 1995 Daily Tax Rep. (BNA) No. 242, at L-1 (Dec. 18, 1995) 
[hereinafter Joint Committee on Taxation]; INTERNAL REVENUE SERV., DEPARTMENT OF 
THE TREASURY, PUB. No. 596, EARNED INCOME CREDrr 1 (1995). 

61. See INTERNAL REVENUE SERV., supra note 60. 
62. Joint Committee on Taxation, supra note 60, at L-1; INTERNAL REVENUE SERV., 
supra note 60, at 31. 
63. INTERNAL REVENUE SERV., supra note 60. 
64. I.R.C. § 3507(c)(2)(B)(i); Joint Committee on Taxation, supra note 60, at L-1. 
65. INTERNAL REVENUE SERV., supra note 58, at 16. 
66. Id. at 14. 
67. Id. at 15. 
68. Nanny Tax, supra note 51, (1[ 48,633. 
69. I.R.C. § 3402(a). 
70. Id. § 3401(d). 

PAS LIABILITY ISSUES 265 

ment of wages for such services, then "employer" means the person 
having control of the payment of such wages/1 "Wages" are defined 
as "all remuneration . . . for services performed by an employee for his 
employer, including the cash value of all remuneration paid in any 
medium other than cash."72 

4. KEY EXCEPTION—DOMESTIC SERVICE IN PRIVATE HOME 
Wages, for purposes of the withholding responsibility, do not 
include payment for "domestic service in a private home," 73 defined as 
"[s]ervices of a household nature performed by an employee in or 
about a private home of the person by whom he is employed . . . ."74 
Domestic services include: "services performed by cooks, waiters, 
butlers, housekeepers, governesses, maids, valets, baby sitters, janitors, 
laundresses, furnacemen, caretakers, handymen, gardeners, footmen, 
grooms, and chauffeurs of automobiles for family use. "75 

Although the exception sounds archaic, it is sufficiently broad to 
encompass PAS workers/6 This is an extremely important exception 
affecting several employer responsibilities. As to federal income taxes 
for PAS workers, it means that the withholding of federal income 
taxes is optional and depends upon the voluntary agreement between 
the employer and employee/7 However, the filing of annual W-2 
forms and advance payments of the earned income credit to qualified 
employees, if requested, is mandatory/8 The practical impact of forgoing 
income tax withholding is that the worker is left responsible for 
filing quarterly estimated tax payments or for paying the entire tax 
obligation at tax time. 

5. PENALTIES FOR NONCOMPLIANCE 
The IRS may charge the employer with all employment taxes 
that should have been paid, plus a penalty up to the full amount of 
unpaid taxes, plus interest. The penalty differs for unintentional and 

71. Id. 
72. Id. § 3401(a). 
73. Id. § 3401(a)(3). 
74. 26 C.F.R. § 31.3121(a)(7)-1(a)(2) (1996). 
75. Id. 
76. The IRS has taken this position in private letter rulings involving workers 
who provide personal care, household chores, and personal tasks in a private 
home, see, e.g., Priv. Ltr. Rul. 94-05-023 (Nov. 8, 1993). 
77. INTERNAL REVENUE SERV., DEPARTMENT OF THE TREASURY, Pus. No. 926, 
HOUSEHOLD EMPLOYER'S TAX GUIDE 5 (rev. Nov. 1995). 
78. Id. at 6-7. 

266 The Elder Law Journal 

intentional noncompliance. 79 Employers may also face negligence and 
civil fraud penalties. 8° Employers who do not make advance EIC payments 
when required face a penalty equal to the amount of advance 
payments that were not made." 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The federal tax code authorizes the IRS to designate an agent for 
an employer "to perform such acts as are required of employers under 
this title."82 Procedures for becoming and performing the responsibilities 
of an agent for tax purposes are set forth in Revenue Procedures 
70-6.83 The agent may be authorized to handle not only income tax 
reporting, but also withholding and payment of Social Security (FICA) 
and Medicare payroll taxes, federal unemployment insurance taxes, 
and back-up withholdings if required." 

Through this procedure, the state or local government, or a private 
agency, may assume the employer payroll and bookkeeping duties 
with respect to federal taxes without assuming the employer role 
for other purposes. This responsibility includes filing Form 941 or 942 
each quarter. 85 Some PAS programs already do this." In interpreting 
the SSDERA the IRS has indicated that state and local government 
health and welfare agencies that assume responsibility for reporting 
taxes87 and withholdings must continue to file quarterly and cannot 
adopt a yearly filing option. 

7. SPECIAL ISSUE: IS A CASH GRANT INCOME? 
An additional tax reporting issue arises under models of consumer-
directed PAS in which the consumer receives a cash grant in 
order to procure and pay for PAS. Must the consumer/grantee in this 
situation treat the grant as income and include it in his or her gross 

79. I.R.C. §§ 3403, 3509 (1994). 
80. Id. § 6662-6664, 6672; see also Burke, supra note 34. 
81. Nanny Tax, supra note 51, 148,642. 
82. I.R.C. § 3504 (1994). 
83. Rev. Proc. 80-4, 1980-1 C.B. 581, deals with designation of state and local 
agencies as fiscal agents. It explains "the procedures to be followed by state and 
local health and welfare agencies wishing to act as agents under section 3504 of the 
Internal Revenue Code for welfare recipients who become the employers of individuals 
furnished by the agencies to provide in-home domestic service for the welfare 
recipients." 
84. Rev. Proc. 70-6, 1970-1 C.B. 420. 
85. I.R.S., supra note 56. 
86. SABATINI°, supra note 7, at 23-24. 
87. I.R.S. Notice 95-18, 1995-17 I.R.B. 13. 

PAS LIABILITY ISSUES 267 

income for income tax purposes? Marc Greidinger and his coauthors 
analyze this issue under federal tax law in the context of family support 
services and concludes: "Based on current IRS policy, it is probable 
that families who receive cash assistance to care for their children 
with developmental disabilities from a federal, state or locally established 
family assistance program can exclude payments when calculating 
gross income for federal tax purposes without incurring 
problems later."" 

The conclusion is based primarily on several revenue rulings 
that allow payments received from a "legislatively provided social 
benefit program for promotion of general welfare objectives" to be excluded 
from a recipient's gross income. 89 It does not appear that this 
issue has posed much of a problem for PAS programs generally. 
However, the question of whether cash grants for PAS constitutes income 
may also arise in the context of public benefit program eligibility. 
In other words, will a cash grant to the individual for purposes of 
securing PAS adversely affect eligibility for other state or federal 
means-tested programs? 

Whether this question has posed a serious problem for PAS programs 
is not clear. The answer depends both on the avenue through 
which the cash grant is paid and the eligibility rules for the particular 
benefit in question. For example, the Colorado Home Care Allowance 
is paid as a supplement to Social Security Insurance. This payment 
structure ensures that the benefit is treated the same as the SSI benefit.
90 State-created payment structures could be viewed differently. 

B. Social Security and Medicare Tax (FICA) 
1. LEGAL SOURCE 
Social Security and Medicare are federally controlled by the 
FICA incorporated into the Internal Revenue Code, 26 U.S.C. § 3101 
(tax on employees), § 3102 (tax on employers), and § 3121 (definitions), 
as amended by the SSDERA. 

88. MARC GREIDINGER ET AL., AVOIDING LEGAL PITFALLS IN THE FUNDING OF 
FAMILY SUPPORT SERVICES: AN ANALYSIS PREPARED BY THE AMERICAN BAR ASSOCIATION'S 
COMMISSION ON MENTAL AND PHYSICAL DISABILITY LAW 19 (1993). 
89. Id.; see Rev. Rul. 74-205, 1974-1 C.B. 21. 
90. See SABATINO, supra note 7, at 62. 

268 The Elder Law Journal 

2. NATURE OF RESPONSIBILITY 
Employers have two tasks: one, they must pay the employer's 
share of the Social Security (FICA) tax; and two, they must withhold 
and pay the employee's share of FICA to Social Security. The employer 
and employee portions of the FICA tax each equal 7.65% of 
wages and will remain at that level unless changed by Congress." 
The tax is charged on wages up to a maximum tax base amount that is 
far higher than PAS workers are likely to earn (up to $60,600 in earnings 
for the Social Security tax, and unlimited for the Medicare tax in 
1994). 92 The personal income tax return Form 1040 includes a new 
schedule for reporting and paying FICA and other employment taxes 
on an annual basis.93 

3. TO WHOM THE RESPONSIBILITY APPLIES 
FICA withholding applies to "employment" defined as "any service 
. . . performed by an employee for the person employing him, 
irrespective of the citizenship or residence of either." 94 Here, the common-
law rules for determining whether an individual is an "employee" 
generally apply,95 although some special rules apply to 
certain types of employees not generally relevant to home care (e.g., 
certain commercial drivers, life insurance sales people, industrial 
homeworkers, and traveling sales people).96 

As an aid to determining whether an individual is an employee 
under the common-law rules, the IRS has identified twenty factors to 
be considered, published in Revenue Ruling 87-41, 1987-1 C.B. 296. 
They are described in appendix 1. 

4. THRESHOLDS/KEY EXCEPTIONS 
Through 1993, the responsibility to withhold and pay FICA did 
not apply if wages totaled less than $50 per quarter.97 The SSDERA 
has raised that threshold to $1,000 per year for 1994 and 1995. 98 There


91. See I.R.C. § 3111 (1994). The 7.65% is actually made up of three components: 
5.26% for the Social Security trust fund, 0.94% for the disability insurance 
trust fund, and 1.45% for the Medicare. 
92. I.R.C. § 3121(a). 
93. See sources cited supra note 56. 
94. I.R.C. § 3121(b). 
95. Id. § 3121(d)(2). 
96. Id. § 3121(d)(3). 
97. I.R.C. § 3121(a)(7)(B) (1988), amended by I.R.C. § 3121(a)(7)(B) (1994). 
98. I.R.C. §§ 3121(a)(7)(B), 3121(x) (1994); 42 U.S.C. § 409(a)(6)(B) (1994). 

PAS LIABILITY ISSUES 269 

after, the threshold will be adjusted annually for inflation. 99 'Wages" 
with regard to the FICA tax do not include nonmonetary compensation 
for "domestic service in a private home" defined above. 1°° These 
noncash exempt items may include meals, lodging, clothing, bus or 
train tokens, or other goods or commodities.'°' 

The FICA need not be paid in limited situations involving family 
relationships. Specifically, domestic services may be exempt if 
provided: 

• By a spouse, 
• By a child under the age of twenty-one in the employ of his or 
her mother or father, 
• By a father or mother in the employ of a son or daughter 
(although additional limitations apply if the actual care recipient 
is a grandchild). 102 
This exception is directly applicable to paid PAS services provided by 
one's spouse, child, or parent. 

Beginning in 1995, the FICA tax does not apply to domestic service 
employees under age eighteen, unless the employee's principal 
occupation is domestic service. Being a student is considered an occupation 
under this test. Therefore, if the worker is a high school student, 
the FICA tax does not apply.1°3 

5. PENALTIES FOR NONCOMPLIANCE 
The penalties for noncompliance are the same as for Income Tax 
Withholding. See section V.A.5 above. 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The federal tax code authorizes the IRS to designate an agent for 
an employer "to perform such acts as are required of employers under 
this title.' '104 See section V.A.6 above. 

99. I.R.C. § 3121(x). 
100. Id. § 3121(a)(7)(A). 
101. Id. § 3121(a)(7)(A); 26 C.F.R. § 31.31-1(b) (1996); INTERNAL REVENUE SERV., 
HOUSEHOLD EMPLOYERS TAX GUIDE, I.R.S. PUB. No. 926 (1995). 
102. I.R.C. § 3121(b)(3). 
103. Id. § 3121(b)(21) (added by § 2(a)(C) of the SSDERA). 
104. Id. § 3504. 

270 The Elder Law Journal 

7. CASE LAW 
The discussion and rulings described in sections V.A and V.B 
above, regarding the status of a worker as independent contractor or 
employee, apply to Social Security withholding obligations. 

C. Federal and State Unemployment Tax 
1. LEGAL SOURCE 
The principal federal source is the Federal Unemployment Tax 
Act (FUTA), which is part of the Internal Revenue Code at 26 U.S.C. 
§ 3301-3311, although several other acts also affect the unemployment 
insurance system. 1°5 The system's operation relies on cooperative 
federal-state unemployment programs.106 

Within general federal guidelines and requirements, the states 
are left to administer the system under their particular State Unemployment 
Tax Acts (SUTA). 1°7 The system is funded primarily by unemployment 
taxes imposed upon employers. The federal taxes 
generally pay for the costs of administration, while state taxes pay for 
benefits. One set of federal rules govern employer liability for the federal 
tax. Employer liability for state unemployment taxes is governed 
by state law and, consequently, varies among the states. 1°8 However, 
as explained below, part or all of SUTA payments may be deducted 
from FUTA. Therefore, total liability is integrated, rather than 
cumulative. 

2. NATURE OF RESPONSIBILITY 
The federal-state unemployment insurance system pays unemployment 
benefits to workers who lose their jobs through no fault of 
their own. 109 Employers must pay FUTA taxes annually for all employees. 
The federal rate is 6.2% of the first $7,000 in cash wages paid 
to each employee. Noncash wages are not counted."° However, if the 
employer also pays state unemployment taxes, the state tax may be 

105. JACK B. HOOD ET AL., WORKERS' COMPENSATION AND EMPLOYEE PROTECTION 
LAW IN A NUTSHELL 142-43 (2d ed. 1990). 
106. Id. 
107. Id. 
108. See generally ADVISORY COUNCIL ON UNEMPLOYMENT COMPENSATION, UNEMPLOYMENT 
INSURANCE IN THE UNTTED STATES; BENEFITS, FINANCING, COVERAGE: A 
REPORT TO THE PRESIDENT AND CONGRESS (1995); U.S. DEP'T OF LABOR, COMPARISON 
OF STATE UNEMPLOYMENT INSURANCE LAWS (1995). 
109. For example, see California Department of Human Resources Development 
v. Java, 402 U.S. 121, 125 (1971). 
110. I.R.C. § 3306(b) (1994). 

PAS LIABILITY ISSUES 271 

credited against the federal tax up to an amount equal to 5.4% of 
wages. Thus, the effective federal tax may be reduced to as low as 
0.8% if the employer also pays SUTA.1" 

All states have a tax limit that is higher than the $7,000 federal 
limit.n2 The amount of tax is determined under an "experience rating" 
system, containing a graduated series of tax rates, with higher 
rates for employers whose workers have historically suffered the most 
involuntary unemployment. Lower rates are set for employers whose 
workers have lower rates of involuntary unemployment. 113 Thus, employers 
have a tax incentive to keep their rate of employee turnover 
low. 

Beginning in 1995, pursuant to the changes brought about by SSDERA, 
FUTA for domestic workers will be payable annually as part 
of the employer's personal return on Form 1040. 114 State unemployment 
tax filing requirements vary by state. 

3. TO WHOM THE RESPONSIBILITY APPLIES 
FUTA adopts essentially the same definition of employment and 
employee as used for FICA, described above. 115 Thus, the common-
law definition of employee, as elaborated by the IRS twenty-factor test 
applies. However, the term "employer" under FUTA has a monetary 
threshold as part of its definition. In the case of "domestic service in a 
private home,""employer" means any person who during any calendar 
year paid wages in cash of $1,000 or more for such service. 1" A 
threshold of $1,500 applies to other types of employment.117 

Each state defines the employment relationship for purposes of 
SUTA. Qualifying as an independent contractor is, in general, more 
difficult under most state tests than under the common-law rules. 
Like federal law, every state specifically includes "domestic service in 
private homes" as a covered service only if wages exceed $1,000 per 
year.118 Four jurisdictions are even broader than the federal provision. 

111. Id. § 3302(b). 
112. Advisory Council on Unemployment Compensation, supra note 108, at222 (tbl. A-3). 
113. Id. at 73. 
114. I.R.C. § 3510 (added by § 2(b) of the SSDERA); see also Nanny Tax, supranote 51, 48,642. 
115. I.R.C. § 3306(i). 
116. Id. § 3306(a)(3). Compare id. § 3121(b) with § 3121(d)(2). 
117. Id. § 3306(a)(1)(A). 
118. U.S. DEP'T OF LABOR, COMPARISON OF STATE UNEMPLOYMENT INSURANCE 
LAWS 1-6 (1992). 

272 The Elder Law Journal 

The District of Columbia, New York, and the Virgin Islands cover 
such service if the quarterly payroll is at least $500, 119 and Hawaii covers 
such service if the payroll is $225 or more. 120 Also, California expressly 
includes services provided under the state's In-Home 
Supportive Services Program.121 

4. THRESHOLDS/KEY EXCEPTIONS 
The FUTA tax is paid only on domestic employees earning more 
than $1,000 in cash per year. 122 This amount was not changed by SSDERA. 
As with FICA, nonmonetary compensation is not taxed.123 

Domestic services are exempt if provided by a spouse, by a child 
under the age of twenty-one in the employ of his or her mother or 
father, or by a father or mother in the employ of a son or daughter.'24 
The exemption is slightly more liberal than the FICA exemption because 
the additional limitations on caring for grandchildren do not 
apply. 125 Oddly, the "workers under age 18" exception for FICA (see 
section V.B.4 above) does not apply to FUTA, so an employer may 
have to pay FUTA on a domestic worker under age eighteen, but not 
FICA. 

State laws include similar exemptions, although many variations 
exist. 

5. PENALTIES FOR NONCOMPLIANCE 
The penalties for noncompliance are the same as for Income Tax 
Withholding, as described in section V.A.5 above. 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The federal tax code authorizes the IRS to designate an agent for 
an employer "to perform such acts as are required of employers under 
this title. "126 (See section V.A.6 above.) 

State provisions vary and were not examined individually by 
state. 

119. Id. 
120. Id. 
121. Id. 
122. I.R.C. § 3306(a)(3) (1994). 
123. Id. § 3306(b)(7). 
124. Id. § 3306(c)(5). 
125. Compare id. with § 3121(b)(3). 
126. Id. § 3504. 

PAS LIABILITY ISSUES 273 

7. CASE LAW 
The few relevant reported cases dealing with unemployment insurance 
and personal assistance in the home involved primarily questions 
of whether an employment relationship existed. Two cases 
absolved insurance companies from bearing employer responsibility 
for unemployment insurance where it paid for the services of in-home 
workers. In Richards v. Division of Employment & Training,127 the Colorado 
Court of Appeals found that a quadriplegic individual who 
hired, trained, and directed the activities of his full-time attendants 
was an employer and that the insurance company which provided the 
funds to pay the attendants and dictated both hourly rate and the 
number of hours in each day for which it would pay attendants was 
not the employer of the attendants. The Minnesota Court of Appeals, 
in Stearns-Hotzfield v. Farmers Insurance Exchange, 128 similarly refused 
to find an employment relationship between an insurance company 
and an in-home nurse for whose services it paid. 
Two additional cases addressed the issue of whether in-home 
workers were independent contractors or employees for purposes of 
unemployment insurance. Both rejected the assertion that the workers 
were independent contractors. In Lewis v. Commissioner of Jobs & 
Training,129 the Minnesota Court of Appeals held that the home-health 
aides who provided twenty-four-hour care were employees of the 
ninety-two-year-old woman for whom they cared and from whose estate 
they were paid by the woman's conservator. In Hoey v. Commonwealth, 
13° a Pennsylvania court held that nurse's aides were employees 
of the guardian of the disabled individual for whom they provided 
care. The court looked beyond written contracts which had designated 
the aides as "independent contractors" and instead examined 
the true facts of the relationship. 

127. Richards v. Division of Employment & Training, 801 P.2d 22 (Colo. Ct.
App. 1990). 
128. Stearns-Hotzfield v. Farmers Ins. Exch., 360 N.W.2d 384 (Minn. Ct. App.
1985). 
129. Lewis v. Commissioner of Jobs & Training, 425 N.W.2d 309 (Minn. Ct.
App. 1988). 
130. Hoey v. Commonwealth, 499 A.2d 1124 (Pa. Commw. Ct. 1984). 

274 The Elder Law Journal 

D. Minimum Wage and Overtime Pay Requirements 
1. LEGAL SOURCE 
The Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219, is the 
controlling federal statute. States may also have minimum wage laws. 
If state law sets a higher standard than federal law, then the state standard 
applies.131 

2. NATURE OF RESPONSIBILITY 
An employer must pay the federal minimum wage ($4.75 /hour), 
and if the employee works more than forty hours in a single week, 
overtime (one and a half times the hourly rate). 132 Additional restrictions 
apply to the employment of children. 133 The minimum wage 
was last changed in 1996, to $4.75 per hour and increases to $5.15 per 
hour on September 1, 1997.134 The minimum wage is not indexed; it 
changes only by amendment to the FLSA. 135 There is no federal requirement 
to pay overtime for time worked on weekends or holidays, 
or if more than the usual number of hours are worked on any particular 
day. Nor are paid vacations or paid holiday leave mandated.'36 

Some states require a higher minimum wage or benefits, in 
which case state law applies. Otherwise, federal law is controlling.137 
This fact is important in the application of any exemptions to the 
FLSA. For example, if state law does not have a companionship exemption 
similar to that described below in federal law, then state 
wage and hour minimums would apply to workers who fell within 
the federal companionship exemption. 

3. TO WHOM THE RESPONSIBILITY APPLIES 
The responsibility applies to employer-employee relationships. 
The definitions of employer and employee are ambiguous in the 
FLSA. "'Employer' includes any person acting directly or indirectly 
in the interest of an employer in relation to an employee . . . . 'Em


131. HOOD ET AL., supra 105, at 154. 
132. 29 U.S.C. §§ 206, 207 (1996). 
133. Id. § 212(c). 
134. Id. § 206. 
135. See generally id. §§ 206, 207. 
136. See id. § 206. 
137. Id. 


PAS LIABILITY ISSUES 275 

ployee' means any individual employed by an employer [with some 
exceptions]."138 

Federal courts have interpreted the definition more broadly than 
the common law test, applying an "economic realities" test on a case 
by case basis. Factors have included: (1) the extent to which the "employee's 
services" are an integral part of the employer's business; (2) 
the amount of the employee's investment in facilities and equipment; 

(3) the nature and degree of control the employer has retained or exercises 
over the employee; (4) the employee's opportunity for profit or 
loss; (5) the amount of initiative, skill, judgment, or foresight required 
for the success of the claimed independent enterprise; and (6) the permanency 
of the relationship.139 
4. THRESHOLDS/KEY EXCEPTIONS 
As of 1994, domestic services employees must earn at least 
$1,000 in a calendar year, or work eight or more hours in any work 
week, to be covered by the FLSA, unless they fit the "companionship 
services" exemption described below.14° Special wage and hour definitions 
apply to live-in help. 141 

Noncash compensation (e.g., meals and lodging) is considered 
compensation in the amount of the reasonable cost or fair value of the 
item. 142 However, for meals or lodging to be counted as income for 
purposes of meeting minimum wage rules, they must be provided 
primarily for the benefit of the employee, and the employee must accept 
them willingly. If they are provided for the employers' benefit or convenience, 
they are not counted as wages paid. 143 It can be quite complicated 
to apply this rule correctly because the determining factors 
are, in part, subjective. For example, if the consumer with a disability 
clearly needs live-in help, then the consumer probably cannot count 
the room and board as wages (because the arrangement is primarily 
for the employer's convenience, not the employee's). Consequently, 
the consumer must be sure that cash wages meet the minimum wage 

138. Id. § 203(d), (e). 
139. See Debra T. Landis, Annotation, Determination of 'Independent Contractor' 
and 'Employee' Status for Purposes of § 3 (e)(1) of the Fair Labor Standards Act, 29 
U.S.C. § 203(e)(1), 51 A.L.R. FED. 702 (1981 & Supp. 1992). 
140. 29 U.S.C. § 206(f) (based on § 209(a)(6) of the Social Security Act, 42 U.S.C.
§ 409(a)(6) (1996), as amended by the Social Security and Domestic Reform Act of 
1994, Pub. L. 103-387, 108 Stat. 4071). 
141. See 29 C.F.R. § 552.102 (1995). 
142. Id. § 552.100. 
143. Id. § 552.100(b), (c). 

276 The Elder Law Journal 

requirement without adding in the value of room and board. Conversely, 
if the employer could get by without live-in help, then one 
might argue that the room and boaid is for the employee's convenience 
and, therefore, is countable as income. Thus, cash wages need 
not be as high. 

An exemption to the minimum wage and maximum hour requirement 
exits for: "Any employee employed on a casual basis in 
domestic service employment to provide babysitting services or any 
employee employed in domestic service employment to provide companionship 
services for individuals who (because of age or infirmity) 
are unable to care for themselves." 1" Implementing regulations define 
"companionship services" as: 

those services which provide fellowship, care, and protection for a 
person who, because of advanced age or physical or mental infirmity, 
cannot care for his or her own needs. Such services may 
include household work related to the care of the aged or infirm 
person such as meal preparation, bed making, washing of clothes, 
and other similar services. They may also include the performance 
of general household work. Provided, however, That such 
work is incidental, i.e., does not exceed 20 percent of the total 
weekly hours worked. The term "companionship services" does 
not include services relating to the care and protection of the aged 
or infirm which require and are performed by trained personnel, 
such as a registered or practical nurse.145 

Whether one can rely on this exception in order to avoid minimum 
wage and overtime requirements for PAS is a difficult question 
to answer. Available data indicate that most PAS programs meet the 
FLSA wage requirements, because independent providers generally, 
but not always, earn minimum wage or slightly higher. 146 This is 
more likely true in publicly funded programs where workers typically 
work relatively few (e.g., twenty or less) hours per week, largely because 
of service limits in state PAS programs.'47 However, for individuals 
who require full-time assistance or around-the-clock 
assistance, the situation is less clear. Must twenty-four-hour, live-in 
help be paid for all twenty-four hours a day under the FLSA? Must 
sleep time be reimbursed? These questions are addressed below. 

144. 29 U.S.C. § 213(a)(15) (emphasis added). 
145. 29 C.F.R. § 552.6 (1995). 
146. See Lrrvnic & KENNEDY, supra note 39, at 29. 
147. See id. at 20 (reporting that the average number of hours of PAS per weekper recipient in Medicaid personal care option programs was only 11 hours). 

PAS LIABILITY ISSUES 277 

5. PENALTIES FOR NONCOMPLIANCE 
Employers may be liable for double the amount of unpaid wages 
or unpaid overtime. 148 Willful violations may be punishable with a 
potential fine of up to $10,000 and/or imprisonment for up to six 
months.149 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The intermediary agency role is not addressed in the FLSA or 
regulations. 

7. SPECIAL ISSUE—COMPANIONSHIP EXEMPTION 
The issue of whether PAS would fall within the companionship 
exemption to the minimum wage and overtime provisions of the 
FLSA is problematic. The meaning of "companionship services" is 
amenable to varying interpretation, as are the meanings of the regulatory 
limitation on "general household work" and the exclusion of 
"trained personnel." The discussion of case law below explains key 
ambiguities and prevailing views on this issue. 

McCune v. Oregon Senior Services Division 15° is a leading federal 
case on this subject. In McCune, the Ninth Circuit Court of Appeals 
considered an appeal of "full-time live-in attendants for elderly and 
infirm individuals unable to care for themselves." 151 The attendants 
brought suit under the FLSA seeking to be paid minimum wage for all 
the hours they worked. The attendants provided varied services to 
their clients including "cleaning, cooking, hygiene and medical 
care."152 They argued that they were "domestic services employees," 
explicitly covered under the terms of the FLSA. 153 The individuals receiving 
care paid for the attendants' services with funds provided by 
the Senior Services Division and other state agencies.154 

The lower court agreed that the attendants were domestic services 
employees, but it ruled that they also fell within the companionship 
services exemption of the FLSA and, thus, were not covered by 

148. 29 U.S.C. § 216(b). 
149. Id. § 216(a). 
150. McCune v. Oregon Senior Servs. Div., 894 F.2d 1107 (9th Cir. 1990), off g 
643 F. Supp. 1444 (1986). 
151. Id. at 1108. 
152. Id. 
153. Id. at 1109. 
154. Id. at 1108. 

278 The Elder Law Journal 

the FLSA. 155 The appellate court considered the statute, legislative 
history, and regulations creating this exemption, and affirmed the 
finding of the lower court.156 

In analyzing the attendants' claim, the court considered three arguments. 
First, the attendants argued that the Secretary of Labor's 
regulation interpreting the statutory companionship exemption (see 
section V.D.4 above) was too broad and inequitable, because it focused 
on the elderly and infirm recipients of care, rather than on the 
services rendered, as the determinative factor in applying the exemption. 
The attendants pointed out that they have a much less attractive 
job than those domestic service workers providing services to clients 
who are not elderly or infirm. While sympathizing with this argument, 
the court stated that it could not find the Secretary's definition 
unreasonable.157 

The court went on to offer its own policy analysis of this point, 
acknowledging primarily the state's arguments in support of the companionship 
exemption. Specifically, the court reasoned that more people 
can receive these services because the people providing them are 
exempted from minimum wage and overtime laws; and, individuals 
who pay for these services entirely out-of-pocket might not be able to 
afford care and have to be institutionalized if they were required to 
pay minimum wage. The bottom line, according the court, was that 
the attendants should take their policy arguments to Congress and the 
Secretary of Labor and not to the courts.158 

The attendants' second argument sought to apply the "casual 
employment" limitation to companionship services. The FLSA provision 
states: "Any employee employed on a casual basis in domestic 
service employment to provide babysitting services or any employee 
employed in domestic service employment to provide companionship 
services for individuals" is exempt from the minimum wage and maximum 
hour provisions of the FLSA.159 

The attendants argued that the "casual" qualifier applies to companions 
as well as baby-sitters, the result being that companions who 
are full-time employees would not fall into this exemption. They cited 
the legislative history of the section wherein the committee drafting 

155. Id. 
156. Id. at 1109-12. 
157. Id. at 1110. 
158. Id. 
159. 29 U.S.C. § 213(a)(15) (emphasis added). 

PAS LIABILITY ISSUES 279 

the Act explained that "one reason the exemption applied to babysitters 
and companions was that these workers 'are not regular breadwinners 
or responsible for their families' support. ",160 Attendants 
asserted that although they were companions, they were also breadwinners, 
and that therefore Congress did not intend for the exemption 
to apply to them. Unswayed, the court held the plain language of the 
statute does not make a distinction between breadwinners and non-
breadwinners and it is for the legislative branch to decide whether 
such a distinction should be made.161 

The attendants' third argument sought to apply "trained personnel" 
and "general household work" exceptions to the exemption. Specifically, 
the Secretary's regulation excluded from the companionship 
exemption services "performed by trained personnel, such as a registered 
or practical nurse. "162 The attendants in this case were "certified 
nursing assistants," a status requiring sixty hours of formal medical 
training. Many received further on-the-job training and training by 
their clients' doctors to administer medications and provide other 
services. This training was not enough, according to the court, to be 
considered trained personne1.163 

Turning to the companionship services "general household work 
exception" the court looked at the Secretary's regulation which distinguishes 
two kinds of household work. The first kind is included 
within the meaning of companionship services. It consists of "household 
work related to the care of the aged or infirm person such as 
meal preparation, bed making, washing of clothes, and other similar 
services:464 In contrast, if the work is "general household work," it 
can be considered companionship services only if it is "incidental, i.e., 
does not exceed 20 percent of the total weekly hours worked." 165 The 
attendants challenged this regulation arguing that it was "unreasona


160. McCune, 894 F.2d at 1110 (quoting H.R. REP. No. 913, 1974 U.S.C.C.A.N. 
2811, 2845). 
161. McCune, 894 F.2d at 1110. 
162. 29 C.F.R § 552.6 (1995). 
163. McCune, 894 F.2d at 1111. The court also expressed concern that some of 
the functions performed by attendants, such as administering medications, appeared 
to violate the state's Nurse Practice Act, and that the court should not reward 
attendants for such a violation. It is noteworthy that, since this case, Oregon 
has amended its Nurse Practice Act regulations to permit delegation of certainmedical functions to attendants. This is discussed in infra part VII. One mightspeculate that the court might decide this case otherwise today, at least as to attendants 
who perform delegated nursing functions. 
164. Id. at 1111 (citing 29 C.F.R. § 552.6 (1995)). 
165. Id. 

280 The Elder Law Journal 

ble to distinguish between cleaning related to the care of the individual 
and general household work. "166 Again, the court held that the 
Secretary of Labor's regulation was reasonable in light of the legislative 
history.167 

If attendants in Oregon take the court's advice and turn to Congress 
and the Secretary for redress of their grievance, they may find 
no better statement of their case than that of Judge Pregerson, the 
forceful dissenter in this case. Looking at the history of the Act, Judge 
Pregerson noted that Congress extended minimum wage protection to 
domestic service workers because of a growing concern for their wellbeing. 
He stated that although "companions" were exempted from 
these rules, the term was not intended to include persons who provided 
medical care or who did substantial household work, but rather 
only to those who were merely there to "watch an older person. "168 
He further pointed out that the legislative history specifically characterized 
companions as people who were not regular breadwinners or 
responsible for their families' support. He argued that the services 
that attendants provided exceeded those of solely "watching" an older 
person and were hard and back-breaking and should qualify as substantial 
domestic service entitled to the protection of the Act.'69 

Moreover, Judge Pregerson asserted that the training received by 
attendants who were certified nursing assistants should place them 
within the "trained personnel" exception to companionship services. 
He criticized the lower court for brushing aside this training and misreading 
the regulation's example of trained personnel (i.e. registered 
or practical nurses) as a definition of the training necessary to qualify 
an in-home medical worker for this exception. The majority's conception 
of trained personnel, according to Judge Pregerson, "smack[ed] of 
elitism" and ignores the changing reality of the health care industry.17° 

Judge Pregerson addressed the issue of the general household 
work exemption by pointing out that the services performed by these 
workers went far beyond the "incidental" chores contemplated by 

166. Id. at 1111. 
167. Id. 
168. Id. at 1112 (citing S. REP. No. 690, 93d Cong., 2d Sess. 8 (1973), reprinted in 
SENATE SUBCOM. ON LABOR OF THE COMM. ON LABOR & PUBLIC WELFARE, LEGISLATIVE 
HISTORY OF THE FAIR LABOR STANDARDS AMENDMENTS OF 1974, H.R. REP. No. 
913, 94th Cong., 2d Sess. (1974), reprinted in 1974 U.S.C.C.A.N. 2811). 
169. Id. at 1112. 
170. Id. at 1113. 

PAS LIABILITY ISSUES 281 

Congress.171 One of the general rules of FLSA construction is that an 
employee's performance of both exempt and nonexempt activities 
during the same work week defeats any exemption that would otherwise 
apply. In any week that any particular employee does some nonexempt 
work he is covered fully, not pro rata. 172 Note that Judge 
Pregerson did not challenge the content of the Secretary's regulation, 
but rather asserted that the regulation was incorrectly applied in the 
appellants' case. 

Other cases construing the breadth of the companionship exemption 
add little additional light to the issue. Usually these cases 
come before the court as summary judgment motions in which the 
parties argue that, under the facts stipulated by the parties, their opponent's 
claim must fail under applicable law. If material facts are in 
dispute, a summary judgment motion must fail, and the case goes to 
trial. In Sandt v. Holden 173 and Toth v. Green River Regional Mental 
Health/Mental Retardation Board Inc., 174 plaintiffs who claimed coverage 
under the wage/hour provisions of the FLSA failed to survive a summary 
judgment motion. In Sandt, a U.S. district court in Pennsylvania 
found that the plaintiff, hired to provide domestic and nursing services 
to a ninety-nine-year-old woman and having no formal training, 
performed precisely the kind of work intended to fall within the companionship 
exemption.'75 And in Toth, a U.S. district court in Kentucky 
found that plaintiffs who worked as care providers in an 
alternative living unit for mentally retarded adults, failed to set forth 
specific facts to show that more than twenty percent of their time was 
devoted to general household services. Therefore, the court dismissed 
the plaintiffs' claim that they were entitled to the wage and hour 
protections.176 

In contrast, a U.S. district court in Colorado, in Penny v. Corn-
care, 177 found that material facts were in dispute as to whether a 
nurse's aide/home-health aide was a "trained personnel," because she 
claimed to perform nursing functions, though not formally trained or 

171. Id. 
172. Id. at 1114 (quoting Skipper v. Superior Dairies, Inc., 512 F.2d 409, 411 (5thCir. 1975)). 
173. Sandt v. Holden, 698 F. Supp. 64 (M.D. Pa. 1988). 
174. Toth v. Green River Regional Mental Health/Mental Retardation Bd., Inc.,
753 F. Supp. 216 (W.D. Ky. 1989). 
175. Sandt, 698 F. Supp. at 67. 
176. Toth, 753 F. Supp. at 217. 
177. Penny v. Comcare, Inc., 1987 WL 19009 (D. Colo. Oct. 27, 1987). 

282 The Elder Law Journal 

licensed, and whether more than twenty percent of her duties were 
general housekeeping tasks. Thus, the case merited a trial on the facts 
as to whether she fell within the wage and hour protections of the 
FLSA.178 

Interestingly, in a series of decisions in a California case, Bonnette 

v. California Health & Welfare Agency, the issue of whether workers 
who provided a wide range of domestic services under the state's 
large In-Home Supportive Services Program were companions under 
the FLSA came up only in the initial summary judgment motion.179 
The court found that the issue required a tria1. 18° The subsequent trial 
court and appellate decisions never revisited the issue. The only issues 
addressed in the latter decisions were whether the federal wage 
and hour protections for domestic workers were constitutional and 
whether the state and county governments could be responsible for 
paying minimum wage and overtime as "joint employers" of these 
workers. The courts answered "yes" to both questions.'81 
McCune and the related cases highlight the difficulty in applying 
federal and state labor law protections to a home-care-services industry 
that has evolved dramatically since the wage and hour protections 
and exemptions for domestic workers were established in 1974. The 
regulatory provisions seem to envision maids as the archetype for domestic 
service workers, with registered nurses (RNs) or licensed practical 
nurses (LPNs) on one side (the covered side of the FLSA), and 
something akin to baby-sitters for old and infirm persons on the other 
side (the uncovered side). 182 The broad manner in which the Ninth 
Circuit in McCune applied the companionship exemption certainly 
sets an unfortunate precedent from the point of view of the dissenting 
judge and of PAS workers, but the case does not resolve the public 
policy issue. It is essential for the U.S. Department of Labor, Congress, 
and the states to reexamine these policies with a clearer understanding 
of the breadth and depth of home health, home care, and 
personal assistance services as they exist (and continue to evolve) 
today. 

178. Id. at *4. 
179. 414 F. Supp. 212 (1976). 
180. Id. at 214. 
181. Bonnette v. California Health & Welfare Agency, 525 F. Supp. 128 (N.D.
Cal. 1981), affd, 704 F.2d 1495 (9th Cir. 1983). 
182. 29 C.F.R. §§ 785.1-.50 (1995). 

PAS LIABILITY ISSUES 283 

8. SPECIAL ISSUE—PAYING LIVE-INS 
Live-in employees do not have to be paid overtime, but they 
must be paid at least the minimum wage for all hours worked, assuming 
they are not categorized as companionship workers. 183 Of course, 
if the companionship exemption applies, the rules governing minimum 
pay and hours vanish. However, assume for purposes of this 
discussion that the companionship exemption does not apply to PAS 
workers. One must then ask how to count the number of hours for 
which the worker must be paid, including whether workers should be 
paid for sleep time. State labor law regulations govern these situations 
if state law is more beneficial to the employee than federal 
law.184 Otherwise, federal law applies.'" The Department of Labor, 
Wage and Hour Division regulations provide the basic rules that have 
been honed over time by case law: 

• For an employee on duty for less than twenty-four hours, sleep 
time should be treated as compensable time. The regulation 
provides the following example: 
A telephone operator . . . who is required to be on duty for specified 
hours is working even though she is permitted to sleep when 
not busy answering calls. It makes no difference that she is furnished 
facilities for sleeping. Her time is given to her employer. 
She is required to be on duty and the time is work time.186 

Similarly, courts have held that personal attendants who work less 
than twenty-four hour shifts in group homes for "mentally handicapped" 
individuals must be compensated for sleep time.187 

• For employees on duty for twenty-four hours or more (but not live-
ins), the employer and the employee may agree to exclude "a 
bona fide regularly scheduled sleeping period of not more 
than 8 hours" from the hours worked.'" The employer must 
furnish "adequate sleeping facilities," and sleep time conditions 
must be such that the employee "can usually enjoy an 
uninterrupted night's sleep ."189 Sleep time interruptions must 
be compensated, and the entire sleep period must be compen183. 
Id. § 785.5 (1995).
184. 29 U.S.C. § 218 (1994).
185. 29 C.F.R. § 785.22(a) (1995). 
186. Id. § 785.21. 
187. Aguilar v. Association for Retarded Citizens, 285 Cal. Rptr. 515, 517 (Cal.
Ct. App. 1991). The court used the term "mentally handicapped" without further 
explanation. The terminology used in the case descriptions throughout this reportgenerally follows that used in the particular court decision. 
188. 29 C.F.R. § 785.22(a) (1995). 
189. Id. 

284 The Elder Law Journal 

sated "if the employee cannot get at least 5 hours' sleep during 
the scheduled period." 190 If there is no express or implied 
sleep time agreement, sleep time must be compensated.'" 
Courts have also considered, in this context, the general criterion 
of whether the employee's time is spent predominantly 
for the benefit of the employer or the employee. If the former, 
then sleep time must be compensated.192 

• For live-in employees, or those who reside on the employer's 
premises for "extended periods of time," certain periods of 
time may be noncompensable if the employee "may engage in 
normal private pursuits and thus have enough time for eating, 
sleeping, entertaining, and other periods of complete freedom 
from all duties when he may leave the premises for purposes 
of his own."193 The regulation also states, lilt is, of course, 
difficult to determine the exact hours worked under these circumstances 
and any reasonable agreement of the parties 
which takes into consideration all of the pertinent facts will be 
accepted."194 
The meaning of residing for "extended periods of time" was clarified 
in a letter ruling of the Department of Labor, Wage and Hour 
Division, dated February 3, 1981: 

In general, we take the position that employees who reside on 
their employer's premises five days a week are considered to reside 
there "for extended periods of time." Where the facilities offered 
by the employer provide a home-like environment with 
private quarters separate from the residents of a group home, we 
would regard such employees as residing there, even though they 

190. Id. § 785.22(b). 
191. Id. § 785.22; see Skidmore v. Swift & Co., 323 U.S. 134, 136-37 (1944) (holding 
that whether waiting time and sleep time must be compensated in a particularcase is a question of fact which "involves scrutiny and construction of the [particular] 
agreements between the particular parties, appraisal of their practical construction 
of the working agreement by conduct, consideration of the nature of the 
service . . . and all of the surrounding circumstances."); see also Johnson v. City ofColumbia, S.C., 949 F.2d 127 (4th Cir. 1991) (waiver of sleep time and meal time 
pay was not voluntary where fire fighters protested the policy and were 
threatened with loss of job if they did not sign waiver); Bouchard v. Regional Governing 
Bd., 939 F.2d 1323 (8th Cir. 1991) (holding that employer, a mental retardation 
board that ran group homes, relied in good faith on Department of Laborregulations). 
192. Armour & Co. v. Wantock, 323 U.S. 126 (1944); Hultgren v. County of 
Lancaster, Neb., 913 F.2d 498, 504 (8th Cir. 1990) (citing Armour, 323 U.S. 126 
(1944)). 
193. 29 C.F.R. § 785.23 (1995). 
194. Id. § 785.23. 

PAS LIABILITY ISSUES 285 

may have another residence which they may regard as their prin


cipal residence . . . .195 

Sleep time is not the only potentially excludable time from wage 
and hour calculations. The regulations and case law also address off-
duty time, on-call time, rest time, and meal time. Briefly stated, off-duty 
time is not compensable if the employee is completely relieved from 
duty for distinct periods long enough to enable him to use the time 
effectively for his own purposes. 196 If the employee is required to remain 
on the premises on call, then he or she cannot effectively use the 
time for his or her own and must therefore be paid.'" If the employee 
is only required to leave a telephone number where the employee can 
be reached, the on-call time may be excluded from compensation.'" 
The key factor is whether the employee can effectively use the time for 
his or her own purposes. 

Rest periods (twenty minutes or less) must be counted as hours 
worked. If longer than twenty minutes, then the time is probably 
more appropriately analyzed under the rules for off-duty or on-call 
time.'" Bona fide meal periods of over thirty minutes are not considered 
hours worked unless the employee's freedom is restricted by the 
employer.200 

Applying the above guidelines to PAS workers living in the 
homes of their employers requires one to look first at the agreement of 
the parties. Any reasonable agreement regarding sleep time will control, 
if it takes into account all pertinent facts and the agreement between 
the parties is voluntary. 201 Pertinent circumstances include the 
adequacy and privacy of sleeping facilities, and the actual ability to 
enjoy an uninterrupted night's sleep of at least five hours. 202 The exclusion 
of other off-duty time will depend primarily on whether the 
employee can reasonably expect to be free from all duties for long 
enough periods of time such that he or she can effectively use the time 
for his or her own purposes. 203 Again if state law is more beneficial to 

195. Bouchard, 939 F.2d at 1329 (quoting Feb. 3, 1981 Department of Labor letter 
ruling). 
196. 29 C.F.R. §§ 785.14-.17 (1995). 
197. Id. § 785.17. 
198. Id. 
199. Id. § 785.18. 
200. Id. 
201. See id. § 785.22. 
202. Id. 
203. See id. § 785.23. 


286 The Elder Law Journal 

the worker, it preempts these federal guidelines. 204 Therefore, state 
law must always be analyzed before any conclusions can be drawn. 

E. Verifying Citizenship or Legal Alien Status 
1. LEGAL SOURCE 
Federal: The governing federal statute is the Immigration Reform 
and Control Act of 1986, Public Law 99-603, 8 U.S.C. § 1324a, and regulations 
regarding the employment verification process at 8 C.F.R. 
§ 274a (1994). 

2. NATURE OF RESPONSIBILITY 
Employers, including employers of domestic workers, must verify 
and maintain records showing that each employee hired after November 
7, 1986, is a U.S. citizen, a national of the United States, or a 
legal alien who is authorized to work in the United States.2°5 

The employer must have the worker complete and sign the Immigration 
and Naturalization Service (INS) Form 1-9 within three 
business days from the date of hiring.206 The worker must show the 
employer both identification and employment eligibility documents 
from an approved list detailed on Form 1-9. After examining the documents, 
the employer completes the employer's section of Form 1-9. 
If the worker cannot provide the documents in three days, he or she 
must provide proof of application for the documents within the three 
days and the actual documents within ninety days of hire. 207 The 
completed 1-9 form is not filed with the government. Instead, the employer 
keeps it as an employment record for at least three years after 
the date of hiring or one year after the employment is terminated, 
whichever is later.208 

3. TO WHOM THE RESPONSIBILITY APPLIES 
Verification and record keeping responsibilities apply to employers. 
"Employer" means "a person or entity, including an agent or 
anyone acting directly or indirectly in the interest thereof, who engages 
the services or labor of an employee to be performed in the 

204. 29 U.S.C. § 218 (1994). 
205. 8 U.S.C. § 1324a(a)-(b) (1994). 
206. 8 C.F.R. § 274a.2(b) (1995). 
207. Id. 
208. Id. § 274a.2(b)(2)(i)(A). 

PAS LIABILITY ISSUES 287 

United States for wages or other remuneration." 209 "Employee" means 
"an individual who provides services or labor for an employer for 
wages or other remuneration but does not mean independent contractors 
. . . or those engaged in casual domestic employment.' ,210 "Independent 
contractor" includes "individuals or entities who carry on 
independent business, contract to do a piece of work according to 
their own means and methods, and are subject to control only as to 
results."211 The determination is made on a case-by-case basis and is 
not determined by what the individual or entity calls itself. The regulation 
lists additional factors that may guide determinations. 212 INS 
comments to the regulations state that this definition is "consistent 
with current Internal Revenue Service guidelines."213 

An employer may rely on verification done by a "state employment 
agency" (as defined by the Attorney General) for employee referrals 
received from the agency. However, in such cases, the 
employer must retain referral documentation.214 

4. THRESHOLDS/KEY EXCEPTIONS 
The obligation does not apply to "casual employment," which is 
defined as including "employment of individuals who provide domestic 
service in a private home that is sporadic, irregular, or intermittent."
215 These factors are not further defined. 

5. PENALTIES FOR NONCOMPLIANCE 
Failure of an employer to comply with the verification and record 
keeping requirements can result in fines ranging from $100 to 
$1,000 for each violation.216 

An employer who hires a person known to be an unauthorized 
alien can be punished by a fine of $250 to $2,000 for the first offense, 
with higher fines applicable to subsequent offenses, and criminal penalties 
if convicted of a "pattern or practice" of knowingly hiring illegal 
aliens.217 

209. Id. § 274a.1(g). 
210. Id. § 274a.1(f). 
211. Id. § 274a.1(j). 
212. Id. 
213. Control of Employment Aliens, 52 Fed. Reg. 16219 (1987). 
214. 8 U.S.C. § 1324a(a)(5) (1994). 
215. 8 C.F.R. § 274a.1(h) (1995). 
216. Id. § 274a.10(b)(2). 
217. Id. § 274a.10(b)(1). 

288 The Elder Law Journal 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The regulations recognize in the definition of "employer" that an 
employer may act through an agent, in which case the duties under 
the Act apply equally to the agent. "Employer" is defined as "a person 
or entity, including an agent or anyone acting directly or indirectly in the 
interest thereof, who engages the services or labor of an employee to be 
performed in the United States for wages or other remuneration. "218 

7. CASE LAW 
No relevant cases are reported. 
F. Workers' Compensation 
1. LEGAL SOURCE 
The primary workers' compensation act covering federal employees 
is the Federal Employees' Compensation Act (FECA) 5 U.S.C. 
§§ 8101-8150. Other federal laws provide workers' compensation 
type coverage to narrowly defined groups of workers, such as the 
Longshore and Harbor Workers' Compensation Act, 33 U.S.C. §§ 901950, 
and the Black Lung Benefits Act, 30 U.S.C. §§ 901-945. 

Workers' compensation is primarily a state law issue for PAS 
programs. Unfortunately, although every state and the District of Columbia 
have workers' compensation acts, coverage and benefits vary 
by state.219 

2. NATURE OF RESPONSIBILITY 
Employers are required to pay premiums for workers' compensation 
insurance for employees through a private insurance company, 
through a state insurance fund (in some states), or through self-insurance. 
The system ensures that workers who are injured on the job are 
given prompt payment for certain medical expenses and wage losses 
with a minimum of legal formality and expense. Benefits may also 
extend to workers' dependents and to survivors of workers killed on 
the job. The system is based on the idea that the employee should be 
entitled to prompt benefits regardless of whether the employer was at 
fault; but in return, the worker gives up the right to sue the employer 
for injuries from work-related accidents. 22° This idea describes the 

218. Id. § 274a.1(g) (emphasis added). 
219. See generally William J. Nelson, Jr., Workers' Compensation: Coverage, Benefits, 
and Costs, 1990-91, 56 Soc. SECURITY BULL. 68 (1993). 
220. See HOOD ET AL., supra note 105. 

PAS LIABILITY ISSUES 289 

general pattern of workers' compensation within states, but actual 
practices vary widely, especially in coverage of domestic service. 

3. TO WHOM THE RESPONSIBILITY APPLIES 
"Employers" are required to provide the coverage for "employees," 
subject to several possible exceptions that vary by state law.22' 
These terms are defined in each state's workers' compensation statute. 
Although definitions generally parallel the common-law concepts, 
statutory definitions are controlling to the extent that they modify the 
common-law concept.222 

4. THRESHOLDS/KEY EXCEPTIONS 
Domestic or household employment is entirely excluded from 
the workers' compensation system in the majority of states. 223 However, 
a minority of states provide some coverage for domestic employees 
who work over a specified hours threshold per week or per 
quarter, or who earn more than a certain amount of wages per quarter.
224 Only New Hampshire covers all domestic workers. 225 It is important 
to note that most of the states allow exempt employment to be 
covered if the employer voluntarily accepts coverage.226 

Even if domestic help is covered, some states nevertheless exempt 
all employers who employ fewer than a minimum number of 
employees. "Eight States exempt employers with fewer than three 
employees, three States exempt those with fewer than four employees, 
and three States exempt those with fewer than five employees."227 

Flanagan's review of consumer-directed attendant services in 
ten states possessing such programs found that only two states, Maine 
and Wisconsin, provided coverage for attendants. 228 Moreover, the 
Wisconsin Program illustrates how the definition of the employer-employee 
relationship can vary by source of law. The state's workers' 
compensation bureau determined that because counties paid consumer-
directed PAS, the counties are considered employers for the 

221. Id. at 42-44. 
222. Id. 
223. Nelson, supra note 219, at 69. 
224. Nanny Tax, supra note 51, 91 48,643. 
225. COMMERCE CLEARING HOUSE, INC., WHAT YOU OUGHT TO KNOW ABOUT 
HIRING A DOMESTIC 25 (1993). 
226. Nanny Tax, supra note 51, 1 48,642. 
227. Nelson, supra note 219, at 69. 
228. FLANAGAN, supra note 30. 

290 The Elder Law Journal 

purpose of workers' compensation only. The determination had no 
bearing on employment status of the worker for other purposes such 
as civil service collective bargaining. 229 Meanwhile, the IRS had already 
granted Wisconsin counties fiscal agent status for purposes of 
tax withholdings,23° thereby insulating them from being deemed employers 
for IRS purposes. To the extent that PAS are not covered by 
workers' compensation laws, consumers and consumer-directed PAS 
program sponsors are vulnerable to personal injury claims through 
the traditional civil tort-law system. 

5. PENALTIES FOR NONCOMPLIANCE 
Penalties for noncompliance vary by state. 

6. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
The potential role for intermediary agencies does not appear to 
be clearly addressed in workers' compensation legislation. However, 
California, by the court decision described below, has found the state 
and consumer to be "joint employers" of personal assistants for purposes 
of workers' compensation.231 This results in the state acting 
similarly to an intermediary agency. The advantage of the joint employer 
concept under workers' compensation is that it meshes more 
easily with the insurance model of workers' compensation. Each employer 
purchases a workers' compensation policy or pays into a state 
risk pool. Applied literally, every consumer of PAS services is a separate 
employer and would need a separate policy. The prospect of 
overseeing thousands of new, mostly one-person policies certainly 
does not find a welcome reception among state workers' compensation 
boards or commissions. They oversee an already beleaguered 
system.232 

The joint employer approach allows the state or any designated 
agency to establish one policy for all the workers in the PAS program. 
However, the disadvantage of the joint employer approach is that 
once the government or an agency is labeled employer for one pur


229. Id. at 37. 
230. Id. 
231. In-Home Supportive Servs. v. Workers' Compensation Appeals Bd., 199 
Cal. Rptr. 697, 704 (Cal. Ct. App. 1984). 
232. Videotape: Symposium on Liability Issues Affecting Consumer-Directed 
Personal Assistance Services (A.B.A. Commission on Legal Problems of the Elderly 
1994) (on file with author) [hereinafter Videotape]; see also WORKERS COMPENSATION 
RESEARCH INST., ANNUAL REPORT/RESEARCH REVIEW (1994). 

PAS LIABILITY ISSUES 291 

pose, some ambiguity arises as to where its employer liabilities stop. 
Theoretically, the concept of an intermediary agency would avoid this 
ambiguity, because the intermediary agency status is, by definition, a 
nonemployer status. 233 What is not clear is whether under existing 
workers' compensation laws an intermediary agency could establish a 
single workers' compensation policy or risk pool for all PAS consumers 
because only "employers" obtain such coverage. In any case, it 
would take only a modest amendment to state law to authorize intermediary 
agencies to secure blanket workers' compensation coverage 
for consumer-employed workers. 

7. CASE LAW 
The limited case law involving personal assistants under state 
workers' compensation programs deals almost exclusively with the 
question of whether the assistant is an employee or independent contractor 
for purposes of workers' compensation. Three state appellate 
court decisions on this topic consistently accept that the worker is an 
employee. The only variation is in the identity of the employer and 
the scope of employees covered by the state workers' compensation 
law. 

In a 1993 Ohio Court of Appeals case, Harmon v. Schnurmacher, 
the court held that a full-time nurse's aide hired by a family member 
and paid from the patient's funds is the patient's employee and not an 
independent contractor for purposes of paying the aide workers' compensation 
benefits.234 

The Oregon Court of Appeals, in McFarland v. Saif Corp. 235 construed 
the state's domestic servant exemption of its workers' compensation 
law broadly enough to prevent recovery by a certified nurse's 
aide who was paid by the state's Senior Services Division of Department 
of Human Resources to care for an older woman. The aide's 
duties included household work, feeding and bathing the woman, 
and turning her in her bed every two hours. The court summarily 
concluded that those were the duties of a domestic servant and do


233. The only "definition" of intermediary status in current law is that of fiscal 
"agent" used by the Internal Revenue Service. See Rev. Proc. 70-6, 1970-1 C.B. 420; 
see also Rev. Proc. 80-4, 1980-1 C.B. 581. 
234. Harmon v. Schnurmacher, 616 N.E.2d 591 (Ohio Ct. App. 1992). 
235. 748 P.2d 150 (Or. Ct. App. 1988). 

292 The Elder Law Journal 

mestic servants are excluded from coverage under the state's workers' 
compensation law.236 

The California Court of Appeals case, In-Home Supportive Services 

v. Workers' Compensation Appeals Board, 237 involved an individual provider 
under the In-Home Supportive Services Program (IHSS) who 
claimed benefits for a back injury. The court found the state to be a 
joint employer, along with the service recipient, and therefore responsible 
for workers' compensation coverage. State law excluded IHSS 
providers from workers' compensation coverage if coverage was 
based on the employment relationship with the IHSS recipient. The 
court reasoned that the statutory language was intended to insulate 
economically disadvantaged IHSS recipients from the costs and burdens 
of employer status. However, the language should not be read 
to insulate the state. Because the state exercised considerable control 
over the administration of the program, it was held responsible for 
workers' compensation as the joint employer.238 
G. State Disability Insurance Taxes 
1. LEGAL SOURCE 
California, Hawaii, New Jersey, New York, Rhode Island, and 
Puerto Rico have statutes establishing mandatory state disability insurance 
programs.239 

2. NATURE OF RESPONSIBILITY 
Employees and, in most cases, employers must pay a special tax 
to fund the program or pay for private insurance coverage that meets 
state requirements.24° 

3. TO WHOM THE RESPONSIBILITY APPLIES 
"Employers" and "employees," as defined by the state's particular 
statute, are responsible for funding disability insurance.241 Generally, 
these programs are coordinated with workers' compensation, so 
in most cases both taxes or premiums are paid at the same time.242 

236. Id. at 152. 
237. 199 Cal. Rptr. 697 (Cal. Ct. App. 1984). 
238. Id. at 710. 
239. Nanny Tax, supra note 51, 48,643. 
240. Id. 
241. For example, see 5 ILL. Comp. STAT. § 315/3 (West 1996). 
242. Nanny Tax, supra note 51, ¶ 48,642. 

PAS LIABILITY ISSUES 293 

4. THRESHOLDS/KEY EXCEPTIONS 
Generally, employment paying less than $1,000 in wages per calendar 
quarter is exempt, although some states have lower dollar-
amount thresholds. 243 In New York, employers of domestic workers 
in a private home need not pay temporary disability benefits tax unless 
they have employed one or more workers for forty hours per 
week for at least four weeks, and at least thirty days in the calendar 
year.244 

5. POTENTIAL ROLE FOR INTERMEDIARY AGENCY 
Our project research did not extend to analysis of these individual 
state disability laws. Therefore, the actual or potential role of intermediary 
agencies has not been determined. 

H. Discussion and Recommendations 
1. CURRENT LAW 
The above discussion highlights the fact that state and federal 
laws differ in definitions of "employer," "employee," and in the range 
of exemptions to various employer/employee responsibilities. As a 
result, much confusion exists among states concerning the extent of 
employer obligations assumed by states or local governments when 
they provide any administrative or management support to consumers 
and workers in consumer-directed PAS programs. States utilizing 
individuals to provide PAS sometimes simply ignore employer legal 
obligations with respect to PAS workers because of a generalized fear 
of liability. They perceive the consequence of workers being deemed 
"employees" of the state or PAS agency as a slippery slope leading to 
unlimited, and often unspecified, liability. 245 Perhaps the greatest 
losers in this scheme are PAS workers who are treated as marginal 
workers. It is no surprise that the 1989 survey of PAS programs by 
the World Institute on Disability found that on average PAS programs 
pay only one employee benefit—FICA (Social Security)—for individual 
providers.246 But consumers also lose by being left in confusion 
about their employer tax responsibilities, by erroneously thinking that 
they can treat workers as "independent contractors" and thereby risk


243. Id. 
244. SABATINO, supra note 87, at 18. 
245. See Lrrvax & KENNEDY, supra note 39. 
246. See supra section V for further discussion. 

294 The Elder Law Journal 

ing penalties, or by abdicating control over their services to an agency 
when they would prefer to control their own services. 

One important response to the confusion is education. Recent 
changes in federal law under the SSDERA greatly simplify the handling 
of wage, Social Security, and federal unemployment deductions 
and reporting. 247 Thus, the feasibility of informing and educating the 
public about these responsibilities is better than ever, if done in a 
thoughtful way. The reality, though, is that federal employment tax 
obligations and FLSA rules represent only a part of the employer obligation 
picture. This report does not even address some other federal 
laws, such as the Occupational Safety and Health Act248 (e.g., blood-
borne pathogen rules), or collective bargaining laws, that could have 
direct implications for PAS programs.249 

Looking beyond federal law, an employment law expert in the 
September 1994 A.B.A. symposium on liability issues affecting consumer-
directed PAS25° rightfully pointed out that most employment 
law is state based. States often impose different or stricter rules than 
those required by the federal government, and a myriad of other employer 
details are entirely or primarily state based, for example: 

• Garnishment/child support rules 
• Employer record-keeping requirements 
• Details that must be itemized in paychecks 
• Employment discrimination rules 
• Hiring/firing protections 
• Meal period and break rules 
• Confidentiality rules for records and files 
• Smoking policies 
• Required signs and posters for employees 
• Required leave policies for voting, family leave, school meetings, 
etc. 
• Insurance coverage requirements 
• State worker safety rules251 
247. Social Security Domestic Employment Reform Act of 1994, 26 U.S.C. 
§ 3510 (1994). 
248. 29 U.S.C. § 651 (1994). 
249. For an overview of relevant laws, see Rick A. Pacynski, Legal Challenges in 
Using Independent Contractors, 72 MICH. B.J. 671 (1993). 
250. Videotape, supra note 232. 
251. See Inlandboatmen's Union of the Pac. v. Department of Transp., 836 P.2d 
823 (Wa. 1992) (holding Occupational Safety and Health Act removes federal preemption 
so that state may exercise its own sovereign power over occupation safety 
and health). 

PAS LIABILITY ISSUES 295 

Given the potential profusion of state-specific employer obligations 
applicable to consumers of PAS, additional strategies besides education 
demand consideration. One possible response is 
simplification of the law as applied to consumer-directed PAS. This is 
most efficiently accomplished at the federal level. The recently enacted 
SSDERA252 constitutes a step in the right direction. If Congress 
revives the consideration of national health reform, including a long-
term care component, it needs to consider simplification or exemption 
of consumer-directed PAS from many of the conventional employer 
rules set by state law, at least to the extent that it does not adversely 
affect the needs and rights of PAS workers. 253 Table 1 provides a summary 
of current law, including the changes enacted by the SSDERA. 

Even with simplification, there remains a need for state or local 
government agencies or private agencies to assume certain employment 
tax and benefit obligations. Many consumers who prefer to self-
direct their services may want someone else to handle these administrative 
responsibilities. And many consumers who can only partly 
self-direct their services need someone else to handle employer responsibilities.
254 Indeed, examples of a governmental entity within 
state or local government or a private agency assuming employment 
tax and benefit obligations already exist. As discussed earlier, California 
functions, according to the courts, as joint employer in the state's 
In-Home Supportive Services Program. 255 Certain counties in Wisconsin 
serve as the consumer's fiscal agent, a role recognized by the IRS. 
Functionally, these roles are indistinguishable and interchangeable. 
However, the fiscal agent or intermediary option may have one important 
advantage over the "joint employer" concept. It suggests a 
more limited and perhaps clearer responsibility for the state or any 
agency serving in the role of intermediary. 

In the end, it does not matter what we call the role of an intermediary 
that assumes limited tax and employment law responsibilities as 
long as the strategy succeeds in eliminating the traditional misperception 
of the employer role as an "all or nothing" reality. Just as the law 
of business organizations recognizes limited partners and managing 
partners as distinct roles with distinct rights and responsibilities, state 

252. 26 U.S.C. § 3510 (1994). 
253. See, e.g., id. 
254. See In-Home Supportive Servs. v. Workers' Compensation Appeals Bd.,
199 Cal. Rptr. 697 (Cal. Ct. App. 1984). 
255. FLANAGAN, supra note 30, at 37. 

296 The Elder Law Journal 

and federal law needs to recognize the distinct roles of limited employers 
(or fiscal agents or intermediary agencies) and directing employers 
(i.e., consumers and their surrogates) in the context of PAS. 
See table 1. 

2. RECOMMENDATIONS ON EMPLOYMENT TAX AND BENEFIT LIABILITY 
ISSUES 
First, existing and future federal or state long-term care programs 
should expressly offer a consumer-directed PAS option that 
recognizes a range of consumer abilities and preferences to self-direct 
services. At one end of the range, consumers who wish to fully direct 
their PAS should have the option of receiving a cash benefit accompanied 
by information, counseling, and training, as needed, in managing 
employer obligations. At the other end of the range, consumers 
should have the option of choosing agency providers who actively 
support and maximize consumer direction in the delivery of services. 
In the broad middle, consumers should have the option to utilize the 
state or a designated agency as fiscal agent, limited joint employer, or 
intermediary for the limited purposes of payroll and benefit functions, 
including income tax reporting and withholding, Social Security, unemployment 
insurance, workers' compensation, state disability insurance 
taxes (where applicable), and verification of citizenship/legal 
alien status. The consumer remains the primary or managing employer 
of the PAS worker, retaining control over hiring, firing, management, 
and supervision of the workers. An expanded version of the 
fiscal intermediary function called supportive intermediary is also recommended. 
Subsection VI.I below contains recommendations regarding 
personal injury issues. 

Second, states and the federal government should ensure coverage 
of PAS workers under Social Security, unemployment compensation, 
the minimum wage and overtime requirements of federal labor 
law, and workers' compensation. Categorical exceptions under federal 
and state labor laws for "domestic services" and "companionship 
services" should be reevaluated and modified to ensure the protection 
of PAS workers. 

Third, the federal government and states should continue to simplify 
employer responsibilities for consumers of PAS who wish to self-
direct their own services so that consumers can meet these obligations, 
directly or through an intermediary agency, without a great 
burden of time, expense, or complexity. 


TABLE 1: Employer Obligations Summary 

Income Taxes FICA 
UnemploymentTaxes 
Minimum Wage/
Overtime 
Citizenship/AlienStatus 
Workers' 
Compensation 
State Disability Ins.
Taxes 
Legal Source Internal Rev. Code 
26 U.S.C. §§ 34013406 
(tax collection) 
& 3507 (earnedincome credit). 
State Law: Variable 
but typically follows 
federal. 
Federal Insurance 
Contribution Act 
IRC 26 U.S.C. 
§§ 3101 & 3102 
(Social Security SrMedicare). 
State Law: None. 
Federal Unemployment 
Tax Act 
(FUTA) IRC 26U.S.C. §§ 3301-3311. 
State Law (SUTA):
Variable. 
Fair Labor Standards 
Act, 29 U.S.C.
§§ 201-219. 
State Law: Variable. 
ImmigrationReform Sr Control 
Act of 1986, 8U.S.C. § 1324a. 
State Law: None. 
Federal Employees'Compensation Act(FECA) 5 U.S.C.
§§ 8101-8150, andothers for federal 
employees. 
State Law: Variable. 
Five states: CA, HI, 
NJ, NY, Sr RI (andPuerto Rico). 
Nature of 
Responsibility 
• Withholding andreporting federalincome tax (Quarterly 
thru 1994.
Annually 1995 & 
after). 
• Advance payment 
of earned 
income credit to 
qualified employ• 
Payment ofemployer's share ofFICA tax. 
• Withholding & 
payment ofemployee's share.
(7.65% each) (Quarterly 
thru 1994.
Annually 1995 Srafter). 
Payment of FUTAtaxes annually.
(6.2% of first $7000in cash wages). 
• Payment of minimum 
wage ($4.75/
hr and $5.15/hr inSept. 1997). 
• Payment of overtime 
if employeeworks more than 40 
hrs/week. 
Verify and maintainrecords showingthat each employeehired after 11/7/86is US citizens, anational of the US,
or legal alien. 
Payment of premium 
for workers' 
compensation insurance 
for on-the-jobinjuries. 
Payment of a tax onbehalf of employeesinto mandatorystate disabilityinsurance programs. 
ees. 
KeyExceptions & 
Thresholds 
Taxes need not be 
withheld for 
"domestic service in 
a private home,"
but annual reporting 
is still required 
§ 3401(a)(3). 
• N/A to domesticservice in a privatehome if cash wages 
are < $1000/calendar 
year (adjustedannually after1995). 
• Exceptions forfamily employmentand workers < 18. 
• Not paid on noncash 
payments fordomestic service. 
• N/A to domesticservice in a privatehome if cash wages 
are < $1000/calendar 
year (adjustedannually after1995). 
• Exceptions forfamily employmentand workers < 18. 
• Not paid on noncash 
payments fordomestic service. 
• N/A to domesticservice in a privatehome if cash wages 
are < $1000/calendar 
year (adjustedannually after1995), or who work 
less than 8 hours in 
any work week. 
• N/A to "companionship 
services." 
N/A to "casualemployment" whichinlcudes "domestic 
service in a privatehome that is sporadic, 
irregular, orintermittent." 8 
C.F.R. § 274a.1(h). 
Majority of states:
N/A to domestic orhousehold emplt. 
Minority of states:
Applies if wages orhour threshold met. 
• Some states 
exempt employerswith fewer than 
threshold # of 
employees. (e.g. 3). 
Usually not applicable 
below a wagethreshold (e.g.,
$1000/calendarquarter). 
Role for 
IntermediaryAgent 
IRS will designate,
upon application,
an employer's agentto perform suchacts as are requiredof employers underthis title...." 
Same as for Income 
Taxes. 
Same as for Income 
Taxes. 
Not addressed. Recognizes thatemployer may actthrough an agent.
No proceduresspecified. 
Not addressed. Not addressed. 
§ 3504 Rev. Pro. 706. 



298 The Elder Law Journal 

Lastly, the existing Medicaid program should be revised to permit 
a flexible continuum of consumer-directed options in the delivery 
of personal care. This requires, at a minimum, eliminating the prohibition 
against benefit payments to consumers and the prohibition 
against utilizing family members or other individuals as providers. 

VI. Personal Injury Liability 
Issues of safety permeate the structure and operation of most 
long-term-care programs. 256 Indeed, concerns about health and safety 
frequently pose limits to consumer autonomy. This occurs when individuals 
express a desire to live in circumstances that, in the opinion of 
medical or social service professionals or family members, present a 
heightened risk of injury, neglect, or even exploitation. When the individual 
is perceived as vulnerable because of disability, age, or 
mental incapacity, the goal of protection waxes in the usual calculus 
of care while the willingness among caregivers to accept risk wanes.257 

As in any endeavor, PAS involve a possibility of inadequate performance, 
injury, or even abuse—not only to the consumer, but also to 
workers or third parties. This section inquires into the nature and 
level of liability risk for personal injury to consumers, workers, and 
agencies involved in providing PAS. To the extent that risk is real, the 
question is posed whether social policies can responsibly minimize 
the risks for parties while respecting client choice. The recommendations 
at the end of this section suggest some basic steps that can be 
taken to answer that question affirmatively. 

At the outer perimeter of these questions, we might consider the 
role of criminal law, because it responds to many intentional wrongs 
and abuses. However, the criminal-law system exists to prevent and 
punish wrongs committed against society, and thus concerns issues 
beyond the relationship among the parties involved in PAS. Civil law 
provides a method for seeking relief (usually monetary) for wrongs 
committed by one party against another. The scope of this discussion 
is limited to civil-law wrongs. 

256. See generally ETHICAL CONFLICIS IN THE MANAGEMENT OF HOME CARE: THE 
CASE MANAGER'S DILEMMA (Rosalie A. Kane & Arthur L. Caplan eds., 1993); EVERYDAY 
Emics: RESOLVING DILEMMAS IN NURSING HOME LIFE (Rosalie A. Kane & Arthur 
L. Caplan eds., 1990); Bart Collopy et al., The Ethics of Home Care: Autonomy 
and Accommodation, HASTINGS CENTER REP., Mar./Apr. Supp. 1990, at 1-16. 
257. See, e.g., ETHICAL CONFLICTS IN THE MANAGEMENT OF HOME CARE, supra 
note 255, at 68-75. 

PAS LIABILITY ISSUES 299 

The civil-law right to relief is generally based either on the violation 
of a legal duty that arises from the particular relationship between 
the parties (a tort action) or on broken promises made between 
the parties (i.e., a breach of contract). These rights and liabilities depend 
on the initiative of individual parties who must decide to initiate 
and pursue civil remedies. The judicial system then determines the 
questions of fault, injury, and remedies.258 

A. Tort Law and Bases for Provider Negligence 
A tort is a civil wrong or injury resulting from a breach of a legal 
duty, other than a breach of contract. Its essential elements are: (1) 
the existence of a legal duty owed by the defendant to the plaintiff; (2) 
breach of that duty; and (3) a causal relationship between defendant's 
conduct and resulting damages to the plaintiff. 259 Torts range from 
simple, direct interferences with one's person (such as assault, battery, 
and false imprisonment) or with property (as in the case of trespass), 
to the more frequent types of torts involving negligence and malpractice, 
and even to injuries to intangible interests, such as those involving 
good reputation, privacy, or emotional distress. 26° Tort law is a 
dynamic, evolving area of law. New torts or new variations of old 
torts are being litigated all the time, in part because of the growing 
complexity of services and relationships, and thus, duties evident in 
our society. 261 

Health professionals and nonprofessionals who provide services 
in the home and community always face a possibility of having to 
defend themselves against a personal injury claim, caused by their alleged 
negligence. When the alleged negligence involves duties of a 
professional, it is termed malpractice.262 The duty, or standard of care, 
involved in negligence cases is usually a duty to act with "reasonable 
care" under the particular circumstances. It is a relative standard, 

258. W. PAGE KEETON ET AL., PROSSER & KEETON ON THE LAW OF TORTS § 1 (5th 
ed. 1984). 
259. BLACK'S LAW DICTIONARY 1489 (6th ed. 1990). 
260. See SPECIAL COMM. ON THE TORT LIABILITY SYS., AMERICAN BAR ASS'N, To-
WARDS A JURISPRUDENCE OF INJURY: THE CONTINUING CREATION OF A SYSTEM OF SUBSTANTIVE 
JUSTICE IN AMERICAN TORT LAW 5-3, 5-11 (1984). 
261. Id. at 14-1 to 14-17. 
262. See generally HEALTH CARE CORPORATE LAW: FINANCING AND LIABILITY 
(Mark A. Hall ed., 1994); MARSHALL B. KAPP, PREVENTING MALPRACTICE IN LONGTERM 
CARE (1987); GEORGE D. POZGAR, LONG-TERM CARE AND THE LAW (1992); FAY 
A. ROZOVSKY & LoRNE E. ROZOVSKY, HOME HEALTH CARE LAW: LIABILITY AND RISK 
MANAGEMENT (1993). 

300 The Elder Law Journal 

gleaned by comparing the defendant's actions against the hypothetical 
reasonable person or against the norms followed by similarly situated 
professionals.263 

To determine the appropriate standard in a given case, courts 
may look to statutes and regulations, customary practice, national 
pronouncements, the provider's own policies and procedures, and 
other sources.264 In simple terms, if a recognized duty has been 
breached and that breach causes injury to another, then the injured 
party is owed damages. In reality, most situations are far more complicated 
because the circumstances around any alleged injury in 
health or long-term care settings are likely to involve multiple parties, 
institutions, or organizations, each with different roles, different duties, 
and differing degrees of connection to the injured party. Several 
conceptual bases of negligence have evolved over time to define the 
duties and liabilities arising from different relationships. 

1. PERSONAL LIABILITY 
This is the simplest form of liability, holding one person responsible 
for his or her negligent or intentional acts that result in harm to 
another.265 

2. DIRECT CORPORATE LIABILITY 
Under this theory, an institution may be held directly liable for 
acts, or failures to act in matters that are directly within its contro1.266 
For example, a hospital may not be directly responsible for a doctor's 
performance in the operating room, but it may be directly responsible 
for its failure to exercise reasonable care in selecting its staff members 
and granting clinical privileges. 

3. VICARIOUS LIABILITY 
This theory of liability holds a principal responsible for the acts 
or omissions of his or her agent. 267 Two different theories of agency 
may support a finding of vicarious liability. 

263. KAPP, supra note 262, at 4-6. 
264. Id. 
265. Id. at 57. 
266. Id. at 63; see also Steven R. Weeks, Comment, Hospital Liability: The Emerging 
Trend of Corporate Negligence, 28 IDAHO L. REV. 441 (1991). 
267. KAPP, supra note 262, at 58. 

PAS LIABILITY ISSUES 301 

a. Respondeat Superior This doctrine, literally meaning "let the 
master answer," requires the existence of an employment relationship 
(or in legal parlance, a "master-servant" or "agency" relationship). If 
an injury is caused by the negligent or intentional wrongdoing of an 
employee who is acting within the scope of his or her employment, 
then the employer can be held liable under this doctrine.268 
b. Apparent or Ostensible Agency This doctrine is relied upon when 
an employment relationship does not exist, yet the institution creates 
the appearance that an agency or employment relationship exists between 
the institution and the negligent actor. 269 For example, a physician 
who is not selected by the patient, but rather assigned to the 
patient,27° or who uses the hospital's logo, 27' or who has an office located 
in the hospita1,272 may be found to be an apparent agent of the 
hospital. As a result, the hospital may be vicariously liable for the 
malpractice of the physician. The agency's disclaimer of an employment 
relationship will not determine the question of whether the 
caregiver was actually the employee of the agency. Courts will examine 
the characteristics of the relationship itself.273 
A review of the literature and reported cases regarding personal 
injury claims against home-care agencies reveals that reported litigation 
is fairly rare. 274 "Reported" litigation means those cases in which 
a judge, usually of an appellate court, has written an opinion with 
findings and legal holdings. Reported litigation against personal 
assistance agencies that are not "home-health" agencies is virtually 
nonexistent. Unreported trial court litigation or insurance claims that 
do not result in litigation are almost impossible to track. Only one 
known national database provides brief summary information about 

268. Id. 
269. Id. at 66. 
270. Capan v. Divine Providence Hosp., 430 A.2d 647 (Pa. Super. Ct. 1980) (patient 
entered hospital for emergency treatment). 
271. Howard v. Park, 195 N.W.2d 39 (Mich. Ct. App. 1972) (physician used 
hospitals stationary for billing statements). 
272. Mduba v. Benedictine Hosp., 384 N.Y.S.2d 527 (N.Y. App. Div. 1976) 
(physician office in hospital). 
273. Id. at 528. 
274. See generally Marshall B. Kapp, Malpractice Liability in Long-Term Care: A 
Changing Environment, 24 CREIGHTON L. REV. 1235 (1991); Kapp, supra note 9; Sandra 
H. Johnson, Quality-Control Regulation of Home Health Care, 26 Hous. L. REV. 
901 (1989). 

302 The Elder Law Journal 

selected trial litigation and pretrial settlements.275 Because this 
database reports only selected cases, there is no way of knowing the 
total number and outcomes of case's, or whether the cases on this 
database are representative of all cases. A summary of both the reported 
and unreported available cases is contained in the next section. 

B. Cases 
1. REPORTED DECISIONS 
A search of the case law revealed only four reported cases directly 
involving home-health care or in-home-supportive-services 
agencies.276 It should be remembered that an enormous body of medical 
malpractice and negligence law is also relevant to PAS programs, 
even though the settings and services involve hospitals, doctors, 
nurses, nursing homes, and other providers and venues. Other authors 
have more fully examined a broad spectrum of personal injury 
liability issues in long-term care or services settings.277 

In a recent New York decision, Walker v. Ehcci Home Care Services, 
the plaintiff, suffering from multiple sclerosis (MS), sued a home-
care agency and others for injury caused when his home-care worker 
left him unattended.278 An emergency requiring hospitalization occurred 
during the unattended period. The worker's contractual duties 
were "cooking, cleaning and other household tasks." 279 The home-
care agency asked the court to dismiss the case, arguing that the 
agency owed no duty to the plaintiff beyond the contracted tasks. The 
court found as a matter of law that a duty of care existed beyond the 
contract obligations. The court relied on the fact that the home-care 
worker had been instructed about the symptoms of MS and the emergency 
circumstances under which an ambulance should be called, and 
had actually called "911" on plaintiff's behalf on several occasions. 
According to the court, the case needed to go to trial to determine 

275. The database is produced by LRP Publications and is available throughWestlaw as the LRP-JV database. 
276. Two other cases, reported on Westlaw, involve home-health agencies but 
are not discussed because they involved only procedural issues: Oliver v. BlueCross & Blue Shield, 1992 WL 139385 (Conn. Super. June 4, 1992) (plaintiff's claims 
dismissed because of failure to file "certificate of good faith" required under state'smalpractice law); Higley v. Regional Educ. Serv. Through Unified Effort, 1990 WL 
271094 (Conn. Super. Apr. 6, 1990) (defendant's claim of contributory negligencefound not permissible under state law). 
277. See KAPP, supra note 262. 
278. 621 N.Y.S.2d 301 (N.Y.A.D. 1 Dept. 1995). 
279. Id. 

PAS LIABILITY ISSUES 303 

whether the defendant breached its duty to the plaintiff and as a result 
caused foreseeable injury to the plaintiff.280 

The court's willingness to look beyond the terms of the contract 
to determine whether another or higher duty of care exists represents 
a fairly typical judicial proclivity to define duties and expectations by 
looking at all relevant facts and circumstances and not just those that 
are in documented form. This is especially true when written documents 
are drafted by one party with disproportionately more power 
to dictate terms favorable to itself.281 

Another New York case, Loucks v. Community Home Care Services, 
involved an action against a home-health agency and a former employee 
of the agency for personal injury. 282 The former employee assaulted 
the plaintiff in the plaintiff's home after the plaintiff's 
complaint of theft led to the worker's discharge. The plaintiff argued 
that the agency was vicariously liable for the acts of the former employee 
under the doctrine of respondeat superior and that the agency 
was directly liable for either negligently hiring or retaining the employee, 
or both. The court found that the plaintiff did not have a legally 
sufficient case to go to trial because vicarious liability does not 
exist after termination of employment. And, because the employer 
took prompt corrective action to address the plaintiff's complaint of 
theft, the agency cannot be found to be negligent in either hiring or 
retaining the worker. Finally, the agency was under no legal duty to 
warn the plaintiff that it had fired the worker, because the plaintiff 
himself had already fired the worker.283 

The Alabama Supreme Court had a chance to examine nursing 
supervision in Phillips v. Alamed C0.284 In this case, the estate of Ms. 
Phillips sued a home-health-care agency that had been caring for her, 
claiming that the agency's negligence caused her to die of a pulmonary 
embolus. Ms. Phillips had been seriously injured in an auto accident, 
and upon her discharge from the hospital, she retained the 
home-care services of Alamed to monitor her vital signs and assist her 
with grooming and hygiene needs. Home-health aides cared for her 
three days a week and reported to a registered nurse who supervised 
them. One day, Ms. Phillips complained of shortness of breath, and 

280. Id. 
281. See generally Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991). 
282. 618 N.Y.S.2d 826 (N.Y. App. Div. 1994). 
283. Id. at 827. 
284. 588 So. 2d 463 (Ala. 1991). 

304 The Elder Law Journal 

the aide relayed this fact to the supervising nurse. The nurse did not 
report the condition to Ms. Phillips's physician but did send another 
aide to her house to check on her the next morning. She appeared 
much better. Later in the day, she had a seizure and died.285 

The estate claimed that the supervising nurse had been negligent 
in failing to properly assess Ms. Phillips's condition and in failing to 
report her shortness of breath to her physician. At trial, the plaintiff's 
evidence fell short in one important respect. The plaintiff failed to 
offer adequate expert testimony to establish that Alamed's actions 
proximately caused Ms. Phillips's death. The court directed a verdict 
in favor of Alamed, and the appellate court upheld the ruling. 286 It is 
difficult to tell whether simply poor facts or poor advocacy determined 
the outcome of this case. In any event, it resulted in a vindication 
of the nursing supervisor's discretion. And, as in Loucks, the 
defendant agency prevailed perhaps because it responded to 
problems promptly and reasonably, albeit unreasonably in the eyes of 
the plaintiffs. 

Finally, an Oregon case, Roach v. Kelly, dealt primarily with the 
issue of whether violation of a licensing regulation, in itself, establishes 
negligence on the part of a home-health agency.287 The estate of 
an eighty-seven-year-old woman, Ms. Tuson, sued Kelly Health Care 
and the Visiting Nurse Association for injuries she suffered while receiving 
twenty-four hour live-in care by certified nurse assistants 
(CNAs). Oregon's home-care licensing law required that this kind of 
care be provided by home-health aides (HHAs) and not CNAs, as 
CNAs were trained for institutional care, not home care. The plaintiff 
argued that this fact established negligence per se. The trial court did 
not agree and entered a directed verdict in favor of Kelly Health Care 
on several of the claims. The Oregon Court of Appeals ruled that the 
trial court's handling of the negligence per se allegations was wrong 
and reversed the ruling with respect to Kelly. The court held that 
when the legislature adopts a rule such as this, intended to protect 
certain people from harm, the rule establishes the standard of care in a 
common-law negligence action. Noncompliance with the rule is negligence 
as a matter of law. The burden then shifts to the defendant to 

285. Id. at 464. 
286. Id. at 465. 
287. 742 P.2d 1190 (Or. Ct. App. 1987). 

PAS LIABILITY ISSUES 305 

produce evidence that it acted reasonably when it violated the 
statute.288 

The Roach case has significant implications for how one establishes 
a standard of care and a violation of it. It demonstrates that 
regulatory standards established by licensing and certification regulations 
can be used as the bench marks for standards of care. However, 
not all courts endorse the broad approach taken in Roach. For example, 
in Leahy v. Kenosha Memorial Hospital 2 89 a Wisconsin appellate 
court, reviewing a hospital malpractice claim, held that a violation of 
the state's nurse practice act does not constitute negligence per se, because 
the act is not a "safety statute." The court defined a safety statute 
as a legislative enactment designed to protect a specific class of 
persons from a particular type of harm. The court went on to establish 
a formidable burden for plaintiff's claiming negligence per se. It 
held that for a violation to constitute negligence per se it must be 
demonstrated that the harm inflicted was the type that the statute was 
designed to prevent and that the person injured was in the class 
sought to be protected. Some legislative intent that the statute was 
meant to become a basis for imposition of civil liability must be 
shown.29° 

Even where the statute clearly intends to protect a particular 
class of vulnerable individuals from harm, its application to a particular 
set of facts is not necessarily easy. For example, in Makas v. Hillhaven, 
Inc., the plaintiff attempted to rely on the North Carolina 
statutory Nursing Home Patients' Bill of Rights to establish negligence 
per se against a nursing home. 291 The bill of rights required 
residents "to be treated with consideration, respect, and full recognition 
of personal dignity and individuality . . . to receive care, treatment, 
and services which are adequate [and] appropriate and to be 
free from mental and physical abuse."292 The appellate court was not 
willing to accept this language as sufficient proof, in itself, of the standard 
of care with respect to the negligence claim.293 One might attribute 
this finding to the broad, nonspecific language of the bill of 
rights. Had the regulations involved more specific standards for pro


288. Id. at 1196. 
289. 348 N.W.2d 607 (Wis. Ct. App. 1984). 
290. Id. at 612. 
291. 589 F. Supp. 736 (D.N.C. 1984). 
292. Id. at 743. 
293. Id. 

306 The Elder Law Journal 

cedures, care, or training directly relevant to the harm suffered by the 
plaintiff, perhaps it would have favorably embraced the plaintiff's 
view. 

In addition to government regulatory standards, one might also 
consider the role of private accreditation standards or other industry 
standards in setting standards of care. These may have a similar use 
in personal injury litigation, although their ultimate impact on liability 
exposure may be canceled out by opposing effects. On the one hand, 
they provide protection to providers who rely on them for guidance 
and abide by them. On the other hand, they may provide an easily 
identifiable standard of care convenient to plaintiffs in proving substandard 
care. 

2. TRIAL LITIGATION 
Eight case summaries involving home-care agencies were found 
on the LRP Publishing trial litigation database, available through 
Westlaw computer-based research services. The summaries below 
condense the already brief synopses on the database. 

a. Gustin v. Physicians Home Service JVR No. 141680, 1994 WL 751652 
(LRP Jury) 
Location: Salt Lake County, UT 
Pretrial Settlement: September 1994, for $82,500. 
A forty-one-year-old woman with infantile spinal atrophy suffered 
a fractured leg when she was dropped by a home-health nurse 
while being assisted to the bathroom. The nurse was a substitute for 
the woman's regular home-health nurse. 

b. Plaintiff v. Defendant JVR No. 141790, 1994 WL 751243 (LRP Jury) 
Location: Milwaukee County, WI 
Pretrial Settlement: September 1994, for $250,000. 
A fifty-one-year-old quadriplegic man suffered a fall and head 
injury, resulting in a semicomatose state, when the defendant homehealth-
care service's nurse lost control of the man's wheelchair as she 
was pushing it on a hill. 

c. Gaylard v. Oxford Health Care JVR No. 133764, 1994 WL 547133 
(LRP Jury) 
Location: Montgomery County, AL 
Trial verdict: August 1994, in favor of defendant home-health agency. 

PAS LIABILITY ISSUES 307 

A female suffered burns to both legs when the employee of the 
defendant health-care facility poured hot water on her. The claim did 
not prevail at trial. 

d. Fink, Jr. v. Kimberly Services, Inc. JVR No. 122690, 1993 WL 598798 
(LRP Jury) 
Location: Pinellas County, FL 
Trial verdict: October 1993, in favor of plaintiff for $30,897. 
A thirty-two-year-old male quadriplegic suffered back and other 
injuries when he was dropped by a home-health-care aide while the 
aide was transferring him from his bed to a wheelchair. The plaintiff 
claimed that the agency was negligent in failing to train and supervise 
its employees properly. The plaintiff was found fifty percent negligent 
and the defendant fifty percent negligent, and the award was 
reduced accordingly. 

e. Dickman v. City of New York JVR No. 75161, 1991 WL 448689 (LRP 
Jury) 
Location: Queens County, NY 
Pretrial Settlement: April 1991, for $350,000. 
An eighty-year-old woman suffered a fractured hip when she 
fell in her home while being attended by a city-home-health-care 
worker. Plaintiff alleged that the city failed to properly train, hire, and 
supervise their personnel. 

f. Ready v. Personal Health Care Services Corp. & Community Psychiatric 
Centers JVR No. 0082007, 0072991; 1991 WL 448615, 448614, and 
448499 (LRP Jury) 
Location: San Francisco County, CA 
Verdict: April 1991, in favor of plaintiff for $6,731,000 to $7,755,000 (of 
which $5,850,000 were punitive damages). 
Parents of a three-year-old son who died of pneumonia sued a 
home-health-care service that had been caring for the child's acute 
health problems. The care was terminated by the home-health service 
on the alleged grounds that the plaintiff's insurance company refused 
to continue payment because it was no longer medically necessary. 
The plaintiff contended that his insurer had not refused payment, but 
the home-health service had incorrectly determined that the plaintiff 
was only insured for $50,000, so they terminated care when the bill 
reached $49,425. The defendant contended that the insurer had re



308 The Elder Law Journal 

fused payment and that the child could have died even with continued 
home-health care. 

g. Jones v. Upjohn Healthcare Services JVR No. 69609, 1991 WL 447285 
(LRP Jury) 
Location: Charleston County, SC 
Verdict: March 1991, in favor of defendant. 
An eighty-five-year-old male allegedly suffered third-degree 
burns to his foot during a bath given by the defendant home-healthcare 
service. The man died one month later. His wife, the plaintiff, 
claimed, among other things, that the agency was negligent for retaining 
an employee who it knew, or should have known, was reprimanded 
and terminated by another employer for patient abuse. The 
defendant contended, among other things, that the deceased's 
wounds were not burns but vascular and arterial disease. 

h. Tomlinson v. Underhill Personnel Service JVR No. 63939, 1990 WL 
457814 (LRP Jury) 
Location: Duval County, FL 
Verdict: January 1990, in favor of plaintiff for $134,600. 
A fifty-nine-year-old male suffered a femur fracture while under 
the care of the defendant's employee. He claimed that the employee 
knew he was not able to stand alone, and the employee's negligence 
caused his injury. Plaintiff died of cancer prior to trial. 

Of these eight cases, three were settled, and these three all involved 
falls of some sort. The settlements ranged from $82,500 to 
$350,000. Of the five cases that went to trial, the plaintiffs prevailed in 
three cases (although in one case, the judgment was reduced because 
of the contributory negligence of the plaintiff). Two of the plaintiffs' 
victories involved falls, and one (the largest award) involved the negligent 
termination of care of a three-year-old boy. The highest damage 
award was $7,775,000 (of which $5,850,000 was for punitive 
damages). The lowest award was $30,897. In the two cases where the 
defendant agency prevailed, both involved allegations of bath burns. 

These few cases at least illustrate the particular liability risk to 
agencies arising from cases of falls. However, one should not read too 
much into these few cases, for they are only illustrative. The database 
does not provide any indication of what proportion of all personal 
injury litigation these cases represent nor what selection criteria are 
used. 


PAS LIABILITY ISSUES 309 

C. Assumption of Risk 
A key prerequisite of CD-PAS is the consumer's wish to assume 
some or all responsibility for the direct management of his or her 
care.294 The consumer's consent to such an arrangement is important 
from both a legal and quality-assurance-policy perspective. When an 
individual knowingly accepts a set of responsibilities, the decision 
normally entails an acceptance of any foreseeable risks that accompany 
those responsibilities.295 

In tort law, three separate but overlapping concepts provide a 
framework for analyzing situations in which individuals assume a 
risk. One is the concept of assumption of risk. In some but not all jurisdictions, 
assumption of risk is a defense to a negligence action if the 
defendant establishes that the plaintiff knowingly and voluntarily assumed 
the risk of conduct which might otherwise be negligent. 296 For 
example, a line of malpractice cases holds that if a patient refuses to 
follow the advice of his or her doctor, the doctor cannot be held liable 
for the resulting harm. For example, in Levitt v. Etkind,297 an eighty-
one-year-old woman with multiple chronic impairments, including 
problems with balance, visited her regular doctor for an examination. 
She refused the assistance of a nurse when asked to disrobe in the 
examination room and asked the nurse to leave. While the nurse was 
out of the room, the patient fell and subsequently sued for injuries 
resulting from the fall, claiming negligence in failing to provide 
proper assistance and monitoring. Asserting an assumption of risk 
defense, the defendant was absolved of negligence by a jury.298 

The same set of circumstances can be explained in terms of a 
second concept, contributory negligence. In the above case, the patient's 
conduct might have been deemed contributory negligence, based on a 
finding that the patient's refusal of assistance violated a duty to exercise 
reasonable care. Contributory negligence precludes all or part of 
a damage recovery.299 

The third concept is informed consent which sets a standard of 
care for decision making with which physicians and other health 
providers must comply. Though informed consent cases frequently 

294. DeJong et al., supra note 19, at 89-90. 
295. Id. 
296. KEETON ET AL., supra note 258, § 68. 
297. 265 A.2d 70 (Conn. 1969). 
298. Id. at 75; see also Jacobsen v. Muller, 352 S.E.2d 604 (Ga. 1986) (patient 
assumed risk of pursuing a personal relationship with her job counselor). 
299. KEETON ET AL., supra note 258, § 65. 

310 The Elder Law Journal 

involve more complicated risks inherent in medical treatment decisions, 
the elements of informed consent are directly relevant to any 
assumption of risk. To establish assumption of risk or informed consent, 
courts generally require that the patient's assumption or consent 
be knowing, voluntary, and competent. If these factors are present, 
then responsibility for the individual's choice is deemed to rest on 
that individual, not on the other party, unless there is a compelling 
public policy reason to override the choice.30° 

An exception to assumption of risk frequently acknowledged by 
courts involves circumstances, usually contractual in nature, in which 
one party is at such an obvious disadvantage in bargaining power that 
the effect of the contract is to put the person at the mercy of the other's 
negligence. 301 The policy rests upon a consumer protection foundation.
302 It prevents, for example, the enforcement of contracts with 
broad waivers of liability for one party's negligence. In these instances, 
the advantages of the arrangement unfairly inure to one party 
with all the disadvantages to the other. 303 However, where a consumer 
knowingly and voluntarily chooses to control some or all aspects 
of his or her PAS, this protective policy appears less applicable. 
To many consumers, greater control and flexibility are real advantages. 
The key is whether the choice is knowing, voluntary, and 
informed. 

In summary, the elements of informed consent should be considered 
in evaluating the legal risks in PAS programs that emphasize 
consumer direction. The elements of informed consent are discussed 
below. 

D. Informed Consent 
Medical providers are subject to claims of malpractice both for 
poor performance in the actual care of a patient and for failure to obtain 
effective consent for treatment. 304 Commonly, malpractice cases 
involve both types of claims. 305 Originally based on a battery theory 
of tort (i.e., the nonconsensual touching of one individual by another), 

300. KAPP, supra note 262, at 79. 
301. KEETON ET AL., supra note 258, § 68. 
302. Id. 
303. Id. 
304. MARSHALL B. KAPP, GERIATRICS AND THE LAW 16-17 (1985). 
305. Id. 

PAS LIABILITY ISSUES 311 

adjudication of consent issues today relies primarily on an inquiry 
into negligence in the informed consent process.306 

Valid consent requires three elements. First, the person must be 
"so situated as to be able to exercise free power of choice without the 
intervention of any element of force, fraud, deceit, duress, over-reaching, 
or other ulterior form of constraint or coercion."307 A truism that 
is easily overlooked with regard to home and community-based services 
is that consumers must have meaningful service choices. This is 
the heart and soul of consumer direction. Those choices should include 
the option not to direct one's own care under the consumer-asemployer 
model. If consumer direction is the only "choice" offered, 
whether you like it or not, then it may be argued that the policy of 
consumer direction translates into a non-bargained-for arrangement, a 
de facto abandonment of the principle of consumer choice and control. 
Second, the health-care professional must disclose certain information. 
Standards for disclosure vary somewhat across states, but the 
majority's rule is sometimes referred to as the "reasonable physician" 
or "community" standard. Under this standard, the health-care professional 
must disclose the amount and type of information that a reasonable, 
prudent health-care professional would have disclosed under 
similar circumstances.308 In a minority of states, the "reasonable patient 
standard" applies. Under this standard, the professional must 
disclose the information that a "reasonable patient" in the same situation 
would need to make a voluntary and intelligent decision. The 
focus is on "material risks" that would make a difference to a reasonable, 
average patient.309 Lastly, the patient must be able to understand 
the factual information about the alternatives available and be able to 
make and communicate a decision.31° 

Although PAS programs present quite a different context for discussion 
of informed consent, the benefit and risk trade-offs inherent in 
CD-PAS models make the concept very pertinent. One trade-off is basic 
to consumer-directed care: the option of greater consumer choice 
and control necessarily carries with it the option to choose greater 
risk.311 A policy to enhance autonomy without leaving many persons 

306. Id. at 15-40. 
307. KAPP, supra note 262, at 80. 
308. Id. at 82-83. 
309. Id. at 83. 
310. Id. at 87-90. 
311. The consumer's right to take risks was considered an integral component 
of quality in health and long-term care services, according to the 1995 White 

312 The Elder Law Journal 

in need of PAS at undue risk requires some litmus test for autonomous 
choice. Informed consent offers a framework. However, the 
framework needs some modification and expansion in order to translate 
well to PAS. 

First, the element of voluntariness is significant. Previous studies 
of the availability and mode of delivery of PAS have shown that 
even where more than one delivery mode is available (i.e., services are 
provided by government, agency, and individual providers), consumers 
seldom have a choice of delivery mode. Typically, the client assessment 
process dictates which mode of service one gets.312 Without 
meaningful options, a choice of CD-PAS is no choice at all. In these 
situations, concerns about the vulnerability and safety of recipients of 
care are justified, for persons who may not be able to handle consumer 
direction may have no alternatives. 

The element of adequately informing individuals also has important 
implications for CD-PAS. Typically, PAS is a continuing and 
evolving long-term arrangement. Medical treatments for which informed 
consent is required are typically more episodic. But even if 
continuing, there is a difference in the consumer's role. In a continuing 
course of medical treatment or therapy, the patient's role commonly 
is far more passive than in the context of PAS. The patient can 
decide to keep going or quit at any time, but he or she is at the receiving 
end of specific treatments or therapies. 313 In contrast, CD-PAS requires 
consumers to function actively as employers. This involves 
myriad responsibilities about which consumers need information and 
support to handle. The support part may be just occasional technical 
assistance, but it may also be administrative support such as an 
agency serving as fiscal agent for tax withholding purposes, or more, 
such as recruitment and training, technical support, monitoring, or 
substantial case management support. 314 This takes the "informed" 
component of informed consent to a much higher level—one of information 
and support—a level that is justified by both autonomy and 
quality assurance goals. 

House Conference on Aging. See OFFICIAL 1995 WHFFE HOUSE CONFERENCE ON AGING, 
ADOPTED RESOLUTIONS, RESOLUTIONS 2.1(7) (May 2-5, 1995). 

312. See generally SABATINO, supra note 7. 
313. The distinction in the patient's or consumer's role is often described as the 
"medical model" of care versus the "independent living" model. See DeJong et al., 
supra note 19, at 90-91. 
314. Sabatino & Litvak, supra note 8, at 56. 

PAS LIABILITY ISSUES 313 

Finally, the element of competency is often shrouded in vagueness 
in most home and community-based programs. Here we must 
consider not just capacity to consent to receiving PAS, but capacity to 
manage one's services. Here again, capacity is not an all or nothing 
reality. The consumer may be able to assume some but not all employer 
functions. 315 In her ten-state review of CD-PAS programs, 
Flanagan found that only four had any formal process to evaluate the 
consumer's ability to self-direct their care: Maine, Texas, Washington, 
and Wisconsin. 316 Because her study did not examine the details of 
the process, the scope or depth of these evaluations is not known. The 
other six states reported that ability to self-direct was informally determined 
by case managers. 317 States have become fairly sophisticated 
and reliable in assessing individuals' ability to perform ADLs and 
IADLs.318 Yet, measuring capacity (and preference) to self-direct care 
remains in the gray realm of case manager discretion. 

The concept of informed consent, applied to CD-PAS, requires 
some assessment screen that identifies not only those who are fully 
capable of self-directing their care, but also those who might be able to 
do so with the assistance of training, counseling, program support, 
and possibly the involvement of a surrogate.319 A problem with conventional 
assessment instruments is that they tend to empower clinicians 
or other professionals, rather than the consumer. In other 
words, the professional assessor determines what is best for the consumer.
32° One way to avoid this reversal of consumer direction is simply 
to let individuals decide for themselves if they are able and willing 
to manage their services, with or without support. This approach 
would certainly work well for those who are clearly able and motivated. 
But it may not work well for those persons who are somewhere 
in between clearly capable and clearly incapable. In these 
cases, programs need a process to help consumers evaluate how much 
service management support they require. Further research is needed 
to develop models for such a process. 

If a surrogate is involved, the legal authority of the surrogate 
must be ascertained. This requires knowledge of state-law provisions 

315. Id. 
316. FLANAGAN, supra note 30, at Exhibit I. 
317. Id. 
318. Id.; see also SABATINO, supra note 7, at 36. 
319. FLANAGAN, supra note 30, at Exhibit I. 
320. Id. 

314 The Elder Law Journal 

governing durable powers of attorney, health-care advance directives, 
and "family" or "surrogate" consent laws that apply in the absence of 
an advance directive, and guardianship and conservatorship law. 

E. Consumer Negligence 
The tort liability of providers is only one side of the liability coin. 
Consumers, too, face liability risks for injury caused to individual PAs 
or others. In the employer role, consumers may be subject to risk of 
liability under theories of direct negligence or vicarious liability, just 
as any other employer. 321 Thus, a third party injured in an auto accident 
caused by a PA in the course of work could sue the consumer as 
employer of the PA.322 

More likely are injuries to home-care workers or PAs themselves. 
For example, in the jury trial of Moore v. Monk, a home-care 
registered nurse successfully sued the care recipient-owner of the 
premises for injuries caused when she was struck in the back by a 
sliding, mirrored closet door. 323 In an unusual but pertinent Wisconsin 
case, Gould v. American Family Mutual Insurance Co., a registered 
nurse in charge of a dementia ward at a health center was injured by 
the assaultive behavior of one of the patients who suffered from 
Alzheimer's disease. 324 She sued the resident, his family, and his 
homeowner's insurer for negligence. Only the claims against the insurance 
company went to trial; the others were dismissed. The jury 
found for the injured nurse based on a jury instruction from the trial 
judge that required the jury to apply the same standard of care for 
negligence to a defendant who is mentally impaired as to someone 
who has "normal mentality." The appeals court reversed the findings 
of the trial court based on the erroneous instruction, holding that "an 
individual suffering from a permanent mental disability that prevents 

321. Kim', supra note 262, at 57, 63. 
322. This was the scenario in the California case of Blevins v. California, 270 
Cal. Rptr. 172 (Cal. Ct. App. 1990), Merced County Superior Ct., Consolidated No. 
6874 (1981), in which an In-Home Supportive Services (IHSS) provider, driving anauto owned by an IHSS recipient, killed a woman and seriously injured the woman's 
11-year-old son. However, the plaintiffs sought to hold the state liable as anemployer and not the HISS recipient. A jury found that the provider was not a 
state employee. 
323. Moore v. Monk, No. 136608, 1994 WL 604400, at *1 (Cal. Super. Ct. Jan.
1994). The jury award in this case was only $15,947. 
324. Gould v. American Family Mutual Ins. Co., 523 N.W.2d 295 (Wis. 1994). 

PAS LIABILITY ISSUES 315 

the individual from controlling or appreciating the consequences of 
his or her conduct is precluded from negligence."325 

Consumers of PAS do include persons suffering from dementia, 
so the Gould case is certainly relevant. However, to the extent that 
consumers have the capacity to choose self-directing modes of PAS 
the standard of care for negligence is likely to be higher. Although 
many of these types of situations may be covered by comprehensive 
homeowner's liability insurance policies, as in Gould, or auto insurance 
policies, such coverage may not be universa1. 326 As a practical 
matter, insurance companies have not viewed in-home help as a big 
problem. 327 However, to the extent that CD-PAS programs expand, 
claims could rise, significantly leading insurance companies to limit 
certain risk coverage. 

F. Other Tort Issues 
Another possible area of tort liability affecting agencies, PAs, 
and consumers, about which home-care providers have shown a 
growing concern is that of abandonment or negligent discharge. 
Abandonment may occur when a provider terminates services to an 
individual whose condition has worsened beyond the point that the 
home-care provider believes manageable (or reimbursable) in the 
home setting. 328 Tort cases based on a theory of abandonment or negligent 
discharge most typically have occurred in cases involving patients 
who have been refused emergency medical treatment in a 
hospital emergency room.329 

325. Id. at 299. 
326. The homeowners' policies of the Insurance Services Office (ISO and State 
Farm Fire & Casualty Company) both cover "residence employee" which is defined 
as 
an employee of the insured who performs duties, including household 
or domestic services, in connection with the maintenance or use 
of the residence premises. This includes employees who perform 
similar duties elsewhere for you. This does not include employeeswhile performing duties in connection with the business of an 
insured. 

TORT & INS. PRACTICE SECTION, AMERICAN BAR ASSN, ANNOTATIONS TO THE HOMEOWNERS 
POLICY, key no. 9 (1990). 

327. Id. 
328. ROZOVSKY & ROZOVSKY, supra note 262, § 4.3.4; Charles Hirsch, Abandonment—
A Bird's Eye View, LEGAL ASPELIS MED. PRAc., Mar. 1989, at 3; Sandra H. 
Johnson, Liability Issues, in DELIVERING HIGH TECHNOLOGY How CARE 146-47 
(Maxwell J. Mehlman & Stuart J. Younger eds., 1991). 
329. Note, To Treat or Not to Treat: A Hospital's Duty to Provide Emergency Care, 
15 U.C. DAVIS L. REV. 1047 (1982). 

316 The Elder Law Journal 

However, recall the verdict summarized above in the case of 
Ready v. Personal Health Care Services Corp.33° This jury awarded sizeable 
damages, including punitive damages, to the parents of a threeyear-
old infant who died of pneumonia after the home-health-care 
agency terminated care, apparently because they incorrectly thought 
the insurance coverage terminated. The Ready verdict realizes the potential 
liability faced by providers and payers of care if payment decisions 
inappropriately dictate clinical decisions. This potential was 
described in Wickline v. State of California. 331 In Wickline, the court rejected 
a plaintiff's claim that Medi-Cal, the state's Medicaid program, 
was liable for the amputation of her leg, which resulted after Medi-Cal 
decided that she should be dismissed from the hospital four days 
before her doctor recommended. Because the doctor did not protest 
the decision and was unwilling to say that the earlier release was beneath 
the applicable standard of care, the court was unwilling to hold 
Medi-Cal responsible. The court suggested that although the decision 
to discharge rests with the doctor alone, a third-party payor might be 
liable if medically inappropriate decisions are made because of defects 
in the design or implementation of cost containment mechanisms.332 

In nonemergency situations where care is contracted for, the 
legal risk of abandonment can normally be eliminated by clear agency 
procedures regarding service agreements, termination rights, and adequate 
notice of termination. 333 Nevertheless, minimizing the legal risk 
does not minimize the distress and fear felt by a consumer who is left 
suddenly without the assistance needed to function. PAS programs 
must address the clinical and practical reality of loss of services in any 
case. Some programs do address this issue by providing a pool of 
emergency on-call service providers or training consumers to develop 
their own poo1.334 

The above discussion would not be complete without recognizing 
that in some jurisdictions, certain immunities from liability may 
affect PAS. The doctrine of sovereign immunity traditionally protected 
all state and federal governmental agencies and employees 
from tort and contractual liability. However, today the doctrine has 

330. No. 842472, 1991 WL 448615 (LRP Jury) (Cal. Apr. 1991).
331. 228 Cal. Rptr. 661 (Cal. Ct. App. 1986).
332. Id. at 670; see also HEALTHCARE CORPORATE LAW: FINANCING AND LIABILITY, 
supra note 262, §§ 8.11.2, 8.23.1. 
333. ROZOVSKY & ROZOVSKY, supra note 262, § 4.34. 
334. SABATINO, supra note 7, at 40-43; see also LrrvAK ET AL., supra note 25 (queried 
each of 16 programs profiled about back-up help). 

PAS LIABILITY ISSUES 317 

largely been abrogated by federal, state, and local legislation. 335 Nevertheless, 
sovereign immunity provisions continue to safeguard at 
least some federal, state, and local government employees from some 
forms of personal liability. The protection varies considerably among 
states.336 

Lastly, spousal and intra-family immunities to personal injury 
liability exist to varying degrees in many states, although in general 
the availability of such immunities has declined.337 These immunities 
are relevant to those PAS programs that permit family members to be 
paid caregivers. Family members may not think intrafamily lawsuits 
are likely, but these immunities may affect insurance coverage. 338 Liability 
insurance companies that cover judgments against the insured 
need not worry about paying claims between family members if intrafamily 
immunity applies. 

G. Worker's Compensation 
Besides the civil-law right to relief based on a personal injury, a 
social insurance approach to workplace injuries also exists in the form 
of workers' compensation programs in every state. Workers' compensation 
dispenses with the need to find and attribute fault to one of 
the parties. 

Employers are required to pay premiums for workers' compensation 
insurance for employees through a private insurance company, 
through a state insurance fund (in some states), or through self-insurance. 
The system ensures that workers who are injured on the job are 
given prompt payment for certain medical expenses and wage losses 
with a minimum of legal formality and expense. Benefits may also 
extend to workers' dependents and to survivors of workers killed on 
the job. The system is based on the idea that the employee should be 
entitled to prompt benefits regardless of whether the employer was at 
fault. In return, the worker gives up the right to sue the employer for 
injuries from work-related accidents. 339 This idea describes the general 
pattern of workers' compensation within states, but actual prac


335. BARRY R. FURROW ET AL., HEALTH LAW § 7-1 (1995). 
336. MARSHALL B. KAPP & JOYCE A. DETZEL, ALTERNATIVES TO GUARDIANSHIP 
FOR THE ELDERLY: LEGAL LIABILITY DISINCENTIVES AND IMPEDIMENTS 81-82 (undated); 
GREIDINGER ET AL., supra note 88, at 6. 
337. GREIDINGER Er AL., supra note 88, at 7-8. 
338. Id. 
339. See HOOD ET AL., supra note 105. 

320 The Elder Law Journal 

monly involve multiple formal and informal caregivers, including 
family members, agency employees, and/or individual providers, 
working part-time and often poorly coordinated. Thus, it is harder to 
attribute an injury to any one provider in particular.353 

With respect to CD-PAS models, we might speculate that the use 
of personal injury litigation against individual providers is likely to 
have a fairly low probability of success for at least three reasons: (1) 
the consumer (or a surrogate) presumably exercises a higher level of 
control over his or her care or services; (2) standards of care are far 
less defined compared to those applicable to professionals; and (3) individual 
providers generally lack the financial resources from which 
to recover significant damages. With respect to government agencies 
that pay for or sponsor CD-PAS, they should be able to minimize liability 
risk under theories of vicarious liability if the service is structured 
appropriately to avoid their being deemed an employer. 

At the same time, the risk of injury will be minimized if sponsoring 
agencies take affirmative quality assurance steps up front for those 
consumers who want such help. The kind of support here goes beyond 
fiscal functions, discussed earlier, and includes help with functions 
such as recruitment of workers, screening of potential workers, 
training of workers and consumers, and supervisory or monitoring 
functions. Of course, this proactive agency role begs the same question—
how much support or oversight can the public agency provide 
without being deemed an employer for purposes of establishing vicarious 
liability?354 The criteria for determining the existence of an employer-
employee relationship for tort purposes is determined by 
common-law principles. 

Apart from vicarious liability, agencies funding PAS programs 
remain directly liable (corporate liability) for any functions they actually 
contro1.355 Thus, if the public agency undertakes to recruit and 
screen workers, and fails to screen out an unqualified, dangerous 
worker, then liability for injury caused by the worker remains a possibility. 
However, these areas of potential liability can be minimized 
and clarified if the limit of the function is clearly defined and communicated 
to recipients of care. Thus, if the agency merely recruits a pool 
of potential workers but leaves screening and reference checking in 

353. Id. 
354. Kapp, supra note 9, at 478. 
355. KAN>, supra note 262, at 63. 

PAS LIABILITY ISSUES 321 

the consumer's hands, this limitation and division of function needs 
to be clearly understood by consumers and agreed to in order to ensure 
that the agency's liability does not extend to screening of 
workers. 

I. Recommendations on Personal Injury Liability Issues 
First, PAS programs should develop a service-planning process 
that explicitly and clearly apportions responsibilities and risks of managing 
PAS (i.e., acting as an employer). The process should involve 
the consumer and the PAS program, supportive intermediary agency, 
or case manager, and be based upon the concepts of consumer choice, 
informed consent, and assumption of risk. 

Second, federal and state PAS programs should develop supportive 
intermediary options to give consumers more alternatives in apportioning 
employer-management responsibilities. These options enable 
the state or a designated agency to provide, contingent on consumer 
consent, certain administrative, clinical, and quality assurance functions 
without the state or designated agency being deemed "employer" 
of the PA worker. Such functions should include: 

• Recruitment of workers; 
• Screening of workers, including criminal records checks; 
• Initial training of workers; 
• Training and counseling of consumers; 
• Supervisory or monitoring functions desired by the consumer. 
Third, state law should recognize the fiscal agent and supportive 
intermediary status for purposes of protecting the state or designated 
intermediary agencies from tort liability under theories of vicarious 
liability applicable to actual or ostensible employers. Direct liability 
principles for failure to carry out designated functions should remain 
unchanged. 

Lastly, states should expressly cover all PAS workers and permit, 
by amendment if necessary, intermediary agencies to secure coverage 
as a single employer for all PAS workers as agent for self-
directing consumers. 

VII. Licensure and Certification Liability 
Every jurisdiction has professional licensure statutes that restrict 
the right to perform certain services to those individuals who, based 
upon demonstration of specified education, training, and knowledge, 


322 The Elder Law Journal 

have been licensed by the state to perform those services. 356 The public 
policy rationale for these licensure statutes is the inherent state "police 
power" to take action "to protect the general health, safety, and 
general welfare of the community."357 The close cousin to licensure is 
certification, which refers to approval by a certifying agency that enables 
a provider to participate in (and get paid by) a given program by 
virtue of meeting the standards set by the program. 356 Medicare and 
Medicaid utilize certification as the primary quality assurance device 
for long-term-care providers. Institutional providers that wish to receive 
Medicare or Medicaid payments must meet the statutes set by 
those programs and submit to a survey and certification process.359 

Private accreditation programs, such as those operated by the 
Joint Commission on the Accreditation of Healthcare Organizations 
(JCAHO), the Community Health Accreditation Program (CHAP), the 
Commission on Accreditation of Rehabilitation Facilities, and the Accreditation 
Council on Services for People with Developmental Disabilities, 
may also function in similar fashion, especially where public 
certification programs grant "deemed status" to accredited providers. 
In such cases, accreditation is deemed a substitute for certification.36° 
For example, the Health Care Financing Administration grants 
deemed status to home-health agencies (i.e., allows them to participate 
in Medicare or Medicaid, or both) if they are accredited by either 
CHAP or JCAHO.361 

Liability under licensure and certification can include, at the extreme, 
criminal liability, such as under state laws making it a crime to 
practice medicine or nursing without a license. 362 As discussed under 
the topic of tort liability, licensure and certification standards may also 
be relied upon by courts and litigants in personal injury cases as evi


356. FURROW ET AL., supra note 335, § 3-1. 
357. Id. 
358. Timothy S. Jost, The Necessary and Proper Role of Regulation to Assure the 
Quality of Health Care, 25 Hous. L. REV. 525, 542 (1988). 
359. Medicare and Medicaid Guide (CCH) TT 12,305-460 (Medicare) (Dec. 1,1994); id. ¶ 14,752 (June 30, 1994). 
360. See Clark C. Havighurst, Foreword: The Place of Private Accrediting Among 
the Instruments of Government, LAW & CONTEIVIP. PROBS., Autumn 1994, at 1, 10; 
Timothy S. Jost, Medicare and the Joint Commission on Accreditation of Healthcare Organizations: 
A Healthy Relationship?, LAW & CONTEMP. PROBS., Autumn 1994, at 15. 
361. See 57 Fed. Reg. 22,773 (1993) (regarding CHAP); 58 Fed. Reg. 35,007(1993) (regarding JCAHO). 
362. See, e.g., CAL. HEALTH & SAFETY CODE § 2799 (West 1992); 225 ILL. COMP. 
STAT. § 65/6 (West 1993); PA. CONS. STAT. § 13 (1951) (misdemeanor provisions for 
violation of nurse practice acts). 

PAS LIABILITY ISSUES 323 

dence of the standard of care to which providers may be held accountable.
363 However, under most circumstances, the primary regulatory 
sanction (and often the only sanction) is loss of certification. 365 Most 
deficiencies under certification standards result in an obligation of the 
provider to prepare a plan of correction, the implementation of which 
may or may not be monitored by the regulating agency. 365 Since 
OBRA 1987, Medicare and Medicaid have required intermediate sanctions 
against home-health-care agencies, including civil fines, suspension 
of admissions, and the appointment of temporary 
management.366 

With respect to PAS, regulatory liability issues affect both individual 
providers and agency providers. For individual providers, a 
question of regulatory liability arises if they provide services that licensure 
or certification standards restrict to registered nurses, certified 
nurse assistants, home-health aides, or some other defined group of 
health providers for which the state has established training, education, 
or practice standards. Services that trigger this question generally 
involve invasive or more hands-on "medical" types of care, such 
as the administration of medicine, injections, catheter care, or bowel 
and bladder care. 

State nurse practice acts may or may not prohibit these kinds of 
tasks if performed by an individual PA hired by the consumer. The 
first section below will examine the coverage of state nurse practice 
acts as they may apply to providers of PAS. The second section below 
will consider the regulatory liability of agencies under home-care-licensing 
statutes where the agency seeks to either perform fiscal agent 
functions or provides other supports, or both, to consumers who are 
fully or partly self-directing their care. 

A. Nurse Practice Acts 
Nurse practice acts govern the performance of the nursing profession 
by establishing mandatory guidelines for those individuals 
deemed qualified to care for the medical needs of others. The statutes 
and regulations that govern the role of nursing attempt to generate 

363. See supra text accompanying notes 287-88. 
364. INSITFUTE OF MEDICINE, IMPROVING THE QUALITY OF CARE IN NURSING 
HOMES 155 (1986). 
365. Id. at 151-52. 
366. Omnibus Budget Reconciliation Act (OBRA) of 1987, 42 U.S.C. § 1395bbb 
(1988); 56 Fed. Reg. 37,054 (1991) (proposed regulation to 42 U.S.C. § 1395bbb). 

324 The Elder Law Journal 

protective measures for patients and clients, although professional licensing 
requirements have also been criticized as inherently anticompetitive 
in nature and effect.367 

"Nursing services" are commonly defined broadly, albeit 
vaguely, by state nurse practice acts. Depending on how broadly one 
construes these acts, a state's definition may restrict significantly the 
range of help that can be provided by PAs, because their help may be 
within the purview of "nursing services." For example, Massachusetts 
defines "professional nursing" as 

the performance for compensation of any of those services in observing 
and caring for the ill, injured or infirm, in applying counsel 
and procedures to safeguard life and health, in administering 
treatment or medication prescribed by a Physician, Dentist, Nurse 
Practitioner or by a Physician Assistant, or in teaching or supervising 
others, which are commonly performed by Registered 
Nurses.368 

Michigan defines the "practice of nursing" as 

the systematic application of substantial specialized knowledge 

and skill, derived from the biological, physical, and behavioral 

sciences, to the care, treatment, counsel, and health teaching of 

individuals who are experiencing changes in the normal health 

processes or who require assistance in the maintenance of health 

and the prevention or management of illness, injury, or 

disability.369 

Most state acts also include "delegation" of nursing tasks by registered 
nurses or the "teaching and supervision of others" within the 
definition of nursing. 37° This component of the practice of nursing 
opens the door to the use of PAS workers in performing a variety of 
"nursing" tasks. However, it also raises many questions about the extent 
to which nurses may delegate tasks, the kinds of tasks they may 
delegate, to whom, the circumstances under which they may delegate, 
and the extent of their training and supervisory functions. A few 
states provide specific guidelines for delegation; examples of these 
will be discussed below. 

1. SURVEY OF ACTS 
As a practical matter, the degree of flexibility in nurse practice 
acts is more clearly determined by the express exceptions under these 
acts. Therefore, the exemptions are significant. The following sum


367. FURROW Er AL., supra note 335, § 3.1.
368. MASS. GEN. LAWS ANN. ch. 13, § 80B (Law. Co-op. 1988). 
369. Mici-i. Comp. LAWS ANN. § 333.17201 (West 1994). 
370. See infra appendix 3. 

PAS LIABILITY ISSUES 325 

mary reports the findings of a review of fifty state nurse practice acts 
and their regulations. The purpose of the inquiry is to determine the 
scope and extent of flexibility in state nurse practice acts with respect 
to the tasks that may be performed by private, unlicensed individuals. 

In preface, it is important to note that many states have several 
types of nurse licensure, such as "nurse practitioner," "nurse aide," 
"licensed practical nurse" (LPN), and "registered nurse" (RN), each 
with separate licensure requirements and exceptions. 371 For the purposes 
of this summary, only the definitions and requirements under 
RN licensing acts were examined, because it is the only category 
clearly comparable across all states and most relevant to our query. 
Moreover, the other professional licensing categories tend to recognize 
similar exceptions to licensure anyway.372 

The nurse practice acts and regulations were requested from 
every state in the summer of 1993. Forty-four states responded. The 
remaining were added in 1994, bringing the total states reviewed to 
fifty (the District of Columbia did not respond). 

The exemptions found in common among the acts were placed 
into six separate categories. These categories are as follows: care by 
friends and family, either gratuitous or compensated; care by domestic 
servants; domestic administration of family remedies; care by an 
employee of an institution; care under the direction of an RN (nurse 
delegation); and care under the direction of a physician or other personnel 
(physician delegation). The categories were developed because 
of the frequency of appearance and the wording of each exemption. 
These do not represent all the common statutory exemptions, but 
rather the ones most relevant to the subject of PAS. Other exemptions 
that were virtually universal or not relevant to PAS were excluded. 
These excluded categories pertain to licensure exemptions for nursing 
students, mental health workers, nursing in the event of an emergency, 
performance of nursing tasks by school health officials, nursing 
according to the tenets of religious practice, reciprocity for out-of-state 
nurses, authorized acts done by persons licensed by other state boards 
or agencies, and care provided by employees of the U.S. government. 

371. E.g., The New Hampshire Nurse Practice Act distinguishes "Advancedregistered nurse practitioner," "Registered nurse," "Licensed practical nurse," and"Certified Nursing assistant." N.H. REV. STAT. ANN. § 326-B:2 (1995). 
372. See infra appendix 3. 

326 The Elder Law Journal 

2. FINDINGS 
Generally, the number of exemptions provided in the acts varied 
among the states. For example, California's act and regulations included 
six of the seven exemptions that fell under the categories examined 
by this study, while Alabama, Kentucky, and Maine had one 
of the exemptions reviewed. A summary chart of findings is attached 
as appendix 3. 
In reviewing these findings, it is important to realize the limitations 
on these data. Regulatory language does not necessarily reflect 
actual practices in a state, for practice may be affected profoundly by 
professional attitudes, custom, training, and history in the particular 
state. Moreover, nurse practice rules may be affected by related laws 
and regulations governing specific state health or long-term-care programs. 
Thus, a law and regulation authorizing a state personal assistance 
program could preempt or modify rules contained in the nurse 
practice act. 373 The findings below reflect only a review of nurse practice 
acts and regulation. 

a. Exemption—Care Provided by Friends and Family Twenty-seven of 
the forty-seven states include an exemption for care provided by 
friends or family members. Of these, sixteen required that the care be 
"gratuitous." The other ten did not specify whether the care must be 
gratuitous, so presumably, the exemption covers paid care by family 
members or friends. Several states, including Nebraska, Delaware, 
Rhode Island, and Georgia, use substantively tautological language. 
For example, Georgia's exemption under this category reads, "[Ole 
incidental care of the sick by members of the family, friends or persons 
primarily utilized as housekeepers provided that such care does not 
constitute the practice of nursing within the meaning of this article." 374 Yet, 
the definition for professional nursing contained within the Georgia 
article states: "to perform for compensation or the performance for 
373. To understand the nature and scope of PAS that are exempt from nurse 
licensure in Texas, one must read side-by-side at least three authorities: NursingPractice Act, Tx. REV. Cry . STAT. ANN. art. 4528 (West 1994) and TEX. ADMIN. CODE 
tit. 25, § 217.11, 218 (1993); TEX. HEALTH & SAFETY CODE ANN. § 142.016 (West 
1996); and a Memorandum of Understanding Between the Board of Nurse Examiners 
(signed by Louise Waddill, Executive Director on Jan. 21, 1994) and the Texas 
Department of Health (signed by Ron P. Mansolo, Associate Commissioner forSpecial Health Services on Mar. 24, 1994). 
374. GA. CODE ANN. § 43-26-12 (1994) (emphasis added). 

PAS LIABILITY ISSUES 327 

compensation of any act in the care and counsel of the ill, injured, or 
infirm."375 

By utilizing such circular language in the statute, the law essentially 
says that care by family, friends (and in Georgia's case, housekeepers) 
is not nursing as long as it is not nursing. The phrase "of any 
act" in the definition of nursing suggests that almost any care provided 
to another is prohibited by this particular act. If that is the case, 
the exemption for friends and family would be negated by the proviso 
that the care must not constitute the practice of nursing. Another 
problem contained within the Georgia exemption deals with the 
phrase "incidental care." There is no indication provided as to what 
activities constitute incidental care. 

The Pennsylvania statute oddly states this exemption by referring 
to "Nome care of the sick by friends, domestic servants, nursemaids, 
companions or household aides of any type," 376 but not 
referring to family members. Nor does the statute define "home care." 

North Dakota limits the exemption to care provided only to "an 
immediate family member,"377 although it is unclear who constitutes 
immediate family. In addition, it puts those without immediate family 
at a distinct disadvantage. Is it equitable that those without available 
family must pay higher-priced licensed professionals for care or 
services that untrained family members could otherwise provide? 

Wisconsin's exemption goes beyond the notion of family and 
also covers "members of religious communities and orders having 
charge of hospitals or taking care of the sick in their own homes."378 
This exemption is different from the virtually universal exemption for 
care provided according to religious tenets, because any care appears 
to be exempted, not just care provided according to religious tenets, as 
long as the provider is a member of a religious community. 

b. Exemption—Care Provided by Domestic Servants Twenty-three 
states include an exemption for care provided by domestic servants or 
a related category of worker. For example, the Pennsylvania statute, 
noted earlier, includes domestic servants and "nursemaids, companions 
or household aides of any type."379 As in the category of care by 

375. Id. § 43-26-3(6). 
376. PA. CONS. STAT. § 4 (1991). 
377. N.D. CENT. CODE § 43-12.1-04 (1993). 
378. Wis. STAT. ANN. § 441.115 (West 1992). 
379. PA. CONS. STAT. § 4 (1991). 

328 The Elder Law Journal 

friends and family, many of these states apply the exemption only if 
the provider does not attempt to portray herself or himself as a nurse. 
The exemption from Colorado is typical of those under this category. 
The Act exempts "care of the sick by domestic servants, housekeepers, 
companions or household aides of any type whether employed regularly 
or because of an emergency of illness, but who shall not assume 
in any way to practice professional nursing."38° 

The exemption as stated raises an obvious question. Does the 
Act permit individuals to perform nursing functions as long as the 
individual makes it clear he or she is not a professional nurse? Or 
does the performance of nursing functions, regardless of any representations 
made, create an implied assumption of the practice of nursing? 
The acts reviewed are unclear on their face. 

Nevertheless, this exemption provides a fairly broad opportunity 
for states to avoid the application of nurse practice restrictions on 
PAS programs, although few have explicitly exempted PAS programs 
in their nurse practice act or regulations. The Kansas Nurse Practice 
Act, for example, does explicitly exempt attendants who work in the 
state's in-home services program. 381 Other states may reach the same 
result by addressing this issue in their PAS-program regulations, 
rather than in their nurse practice acts. Nurse practice acts and PAS-
program regulations need to be read in tandem to determine whether 
domestic servants or a related category of worker are exempted. 

For example, although the Pennsylvania nurse practice act 
vaguely exempts "domestic servants, nursemaids, companions or 
household aides of any type," the state's Attendant Care Program regulations 
provide much more explicit guidance. Nonlicensed attendants 
are authorized to perform "health maintenance activities," which 
might otherwise be considered professional nursing functions.382 
Health Maintenance Activities are those routine activities of daily living 
which are necessary for health and normal bodily functions. 
These activities would be carried out by the consumer if physically 
able or by family members or friends if available. These activities include 
but are not limited to the following: catheter irrigations; administration 
of medication, enemas, and suppositories; and wound care.383 

380. COLO. REV. STAT. ANN. § 12-38-125 (West 1991). 
381. KAN. STAT. ANN. § 65-1124(m) (1992). 
382. OFFICE OF SOCIAL PROGRAMS, COMMONWEALTH OF PA., 1992-1993 At I ENDANT 
CARE PROGRAM REQUIREMENTS § IV.G. (1992). 
383. Id. § IV.G.2. 

PAS LIABILITY ISSUES 329 

The program regulations go on to prescribe the following conditions 
and procedures for the provision of this kind of attendant 
services: 

Unless determined otherwise by the assessment and agreed to in 
the service plan, the consumer will direct and supervise the attendant 
in the specified health maintenance activities. Attendants 
may perform health maintenance activities under the following 
conditions: 

a. The consumer has indicated that he/she has been adequately 
instructed by the appropriate health professionals 
and is thereby qualified and able to instruct and 
supervise his/her attendant in health maintenance activities. 
A statement to this effect is included in the service 
plan. 
b. At the consumer's request, the attendant will be instructed 
in health maintenance activities by health professionals 
as arranged by the provider. 
c. The attendant is instructed and monitored in Health 
Maintenance Activities by the consumer, the consumer's 
physician, and/or a health professional as appropriate. 
d. The provider will monitor the attendant's performance 
of health maintenance activities during the routine monitoring 
visits and through consultation and input from 
the consumer regarding his/her satisfaction with the 
service. 
e. Disposable items or devices are used in caring for the 
consumer whenever they are obtainable. 
f. The attendant's prior experience and work history do not 
indicate unsafe performance of such activities. 
g. The consumer has appropriate arrangements in place to 
respond to health emergencies; a statement to this effect 
is included in the service plan. Information on the arrangements 
for health emergencies is also made available 
to the attendant(s) either by the provider or by the 
consumer. 
h. The provider, the consumer, the attendant(s), and others 
who have committed to provide health maintenance activities 
must sign the service plan. Copies of the service 
plan should be given to all persons providing health 
maintenance activities. 
i. If at any time there is an indication that the health maintenance 
activities are not being carried out adequately by 
the attendant or not being adequately supervised by the 
consumer, the provider has the right and responsibility to 
intervene and provide appropriate corrective 
measures.384 
Other state PAS programs may include provisions similar to 
Pennsylvania's. The survey results reported here, however, focus 

384. Id. 

330 The Elder Law Journal 

comprehensively only on state nurse practice acts and not on PAS 
regulations. 

c. Exemption—Domestic Administration of Family Remedies Eight 
states include an exemption usually phrased, "the domestic administration 
of family remedies." None of the states provide any criteria for 
"family remedy" or who may administer it. Indiana at least makes 
clear that it applies only to remedies given "in the home."385 
d. Exemption—Care by an Employee of an Institution Twelve states include 
an exemption for care provided by an employee of an institution, 
although these states differ in the types of institutions that are 
covered by the exemption and other prerequisites. Most apply to at 
least hospitals and nursing homes. Iowa's and Tennessee's exemptions 
also apply to certain office settings, 386 and Ohio's to "persons 
employed as nursing aides, attendants, orderlies, or other auxiliary 
workers in patient homes [and] home health agencies." 387 The findings 
under this category probably do not represent an accurate picture 
of institutional nurse practice rules, because hospitals, nursing homes, 
and other institutions operate under their own extensive regulatory 
schemes. 
e. Exemption—Care Provided Under the Direction of a Registered 
Nurse Forty-six states include an exemption for care delegated by or 
provided under the direction of a licensed or registered nurse. In 
thirty-eight of these states, the delegation function is included in the 
definition of nursing practice—either specifically referring to delegation 
or teaching and supervising others. This total includes delegation 
only to unlicensed personnel and not delegation to other licensed personnel 
such as to LPNs. This review also does not account for any 
special medication delegation rules that may be set forth separately in 
the regulations. Ten states include specific guidelines in their regulations 
governing the limits, conditions, and procedures for nurse delegation.
388 These guidelines varied significantly in scope and detail. 
For example, the fairly detailed rules developed by Oregon and Texas 
385. IND. CODE ANN. § 25-23-1-27.1 (West 1993). 
386. IOWA CODE ANN. § 152.1 (West Supp. 1995); TENN. CODE ANN. § 63-7-102 
(Supp. 1995). 
387. OHIO REV. CODE ANN. § 4723.32 (Anderson 1994).
388. Alaska, Colorado, Maryland, Michigan, Mississippi, Nevada, New Jersey, 
New Mexico, Oregon, and Texas include specific guidelines. See infra appendix 3. 

PAS LIABILITY ISSUES 331 

can be contrasted with the shorter, more discretionary protocol of 
New Jersey. 

Oregon's regulations are quite specific in the scope of the authority 
delegated to those individuals who do not have a nursing li


389 The

cense.regulation distinguishes "assignment" of a task from 
"delegation" of a task. Where an unlicensed person performs a "basic 
task of client/nursing care" (e.g., ADL and "assisting" with the administration 
of medication), the nurse may simply "assign" this task as 
long as the nurse knows the worker has previously been taught the 
task and is competent. Nursing supervision in this case is discretionary.
39° Where the unlicensed person performs "special tasks of client/ 
nursing care" (e.g., administration of injectable medications, suctioning 
and complex wound care), then the nurse must follow "delegation" 
protocols. 39' The regulations spell out in detail the registered 
nurse's duties to assess, train, supervise, and monitor the delegatee 
and the care recipient. In the latter instance, care may be provided 
"only for clients who have a stable, predictable condition and who 
require minimal nursing supervision."392 

The details in the Oregon regulations may offer nurses greater 
clarity in determining how and when to delegate nursing functions. 
However, it is not at all certain that they encourage the use of delegation. 
The detail has the effect of limiting professional discretion and 
possibly increasing professional liability for the delegated acts. Moreover, 
the regulations make clear that the Oregon Board views delegation 
to unlicensed persons as the least preferable of all care options: 

It is the intent of the Board that the delegation of nursing care to 
unlicensed persons be the exception rather than the rule unless 
the registered nurse can justify the need for delegation. Prior to 
delegating a task of nursing care to an unlicensed person, the registered 
nurse shall determine that there is no other reasonable alternative 
to meet the specific client care needs, other than by 
delegation.393 

The Texas Nurse Practice Act and regulations also provide specific 
guidance for delegation of selected nursing tasks, 394 but its appli


389. OR. ADMIN. R. § 851-47-000 to -030 (1992). 
390. Id. § 851-47-020(2). 
391. Id. § 851-47-010(8). 
392. Id. § 851-47-030(1)(b). 
393. Id. § 851-47-000(10). 
394. Texas Bd. of Nurse Examiners, Rules and Regulations Relating to Professional 
Nurse Education, Licensure and Practice, TEX. ADMIN. CODE tit. 25, § 218 
(1993). 

332 The Elder Law Journal 

cation must be understood in the context of a new category of service, 
PAS, created by the Home and Community Support Services Act of 
1993. The new act defines PAS as: 

routine ongoing care or services required by an individual in a 
residence or independent living environment that enable the individual 
to engage in the activities of daily living or to perform the 
physical functions required for independent living including respite 
service. The term includes health-related services performed 
under circumstances that are defined as not constituting the practice 
of professional nursing by the Board of Nurse Examiners 
through a memorandum of understanding with the department 
in accordance with [this Act] and health-related tasks provided by 
unlicensed personnel under the delegation of a registered 
nurse.395 

The memorandum of understanding, the Board of Nurse Examiners 
regulations, and Texas Department of Health guidelines for home and 
community-support services each provide guidelines for the performance 
of certain tasks by unlicensed persons.396 

Generally, for clients with stable and predictable conditions living 
in independent living environments, unlicensed persons may provide 
personal care (e.g., feeding, preparing meals, transferring, 
toileting, ambulation and exercise, grooming, bathing, dressing, routine 
care of hair and skin, and assistance with medications that are 
normally self administered) without RN delegation or supervision.397 
In addition, unlicensed persons may perform limited nursing tasks for 
these clients with RN delegation and supervision procedures. Such 
tasks may include the administration of oral medications or those administered 
via permanently placed feeding tubes, sublingually, or 
topically, including eye, ear, and nose drops, and vaginal or rectal 
suppositories; assistance with tube feeding through permanently 
placed tubes; and assistance with elimination, including intermittent 
catheterization.398 The criteria for assessment, training, supervision, 

395. TEX. HEALTH & SAFETY CODE ANN. § 142.001(20) (West 1994). 
396. Texas Bd. of Nurse Examiners, Rules and Regulations Relating to Professional 
Nurse Education, Licensure and Practice, TEX. ADMIN. CODE tit. 25, 
§§ 217.11, 218; Texas Dep't of Health, Home and Community Support Services 
Agencies Rules and Regulations, TEX. ADMIN. CODE tit. 25, §§ 115.1- .62; and Memorandum 
of Understanding Between the Board of Nurse Examiners (signed by 
Louise Waddill, Executive Director on Jan. 21, 1994) and the Texas Department of 
Health (signed by Ron P. Mansolo, Associate Commissioner for Special HealthServices on Mar. 24, 1994). 
397. TEX. ADMIN. CODE tit. 25, § 218.9(a), (b). 
398. Id. §§ 218.8(2), 218.9(b). 

PAS LIABILITY ISSUES 333 

and monitoring of the unlicensed person and the care recipient are 
comparable to those in Oregon. 

Other tasks such as those involving professional judgment, or 
sterile procedures involving a wound or a site that could potentially 
become infected, or inserting tubes in a body cavity, cannot routinely 
be delegated to an unlicensed person.399 

In contrast to the rather detailed responsibilities imposed upon 
delegating nurses by Oregon and Texas, the New Jersey nurse practice 
regulations opt for a simpler protocol that gives the RN greater discretion 
in the conduct and oversight of delegated tasks. An RN "may 
delegate selected nursing tasks in the implementation of the nursing 
regimen to . . . ancillary nursing personnel. Ancillary nursing personnel 
shall include but not be limited to: aides, assistants and 
technicians.',400 

The nurse's duty of care is defined as a responsibility "for exercising 
that degree of judgment and knowledge reasonably expected to 
assure that a proper delegation has been made."401 A nurse may not 
delegate tasks that require a nurse's specialized skill, judgment, and 
knowledge, or that involve the management of complications that 
may harm the patient. 402 The degree of supervision required depends 
upon the nurse's evaluation of all factors.403 

f. Exemption—Care Under the Order of a Licensed Physician or Other Personnel 
Ten states include an exemption for care provided under the 
direction of a licensed physician or other health professional. 404 Generally, 
these provisions provide little or no guidance as to conditions 
or procedure for delegation. Because physician licensure acts were 
not studied, it is not clear to what extent physician licensure acts recognize 
or provide guidelines for physician delegation. 
The California statute contains perhaps the most open-ended 
language. It exempts "[t]he performance by any person of such duties 
as required in the physical care of a patient and/or carrying out the 

399. Id. §§ 218.7, 218.8(3), 218.10. 
400. N.J. ADMIN. CODE § 13:37-6-2(a) (1992). 
401. Id. § 13:37-6.2(b). 
402. Id. 
403. Id. § 13:37-6.2(c). 

404. California, Delaware, Indiana, Nebraska, New Mexico, North Carolina, 
Ohio, Oklahoma, Texas, and Washington include this exemption. See infra appendix 
3. 

334 The Elder Law Journal 

medical orders prescribed by a licensed physician."405 The language 
provides neither guidance on the scope of duties that may be prescribed 
nor any training or physician oversight responsibility. As a 
practical matter, the provision must be read in tandem with the regulations 
of California's In-Home Supportive Services (IHSS) Program, 
the largest PAS program in the nation in numbers served.406 

The IHSS Program permits the provision of "paramedical services" 
by personal assistants when ordered by a licensed health care 
professional. State regulations vaguely define "paramedical services" 
as "activities which persons would normally perform for themselves 
but for their functional limitations" and which "due to the recipient's 
physical or mental condition, are necessary to maintain the recipient's 
health."407 A 1987 survey of IHSS recipients showed that about three 
percent received paramedical services, most commonly in the form of 
movement to prevent atrophy, catheter care, injections, changing of 
dressings, administration of medication, tube feeding, and ostomy 
care.408 Physician authorization of paramedical services by unlicensed 
individuals appears to function fairly routinely in California and 
with no record of any reported adverse health consequences to 
consumers.409 

The "other" professionals referred to in some of these states may 
include a "dentist, osteopathic physician, podiatrist or a nurse" in Nebraska,
410 a "psychologist, . . . optometrist, chiropractor, speech 
pathologist, audiologist, or physical therapist" in Iowa, 411 and "any licensed 
health professionals" in Indiana.412 

3. DISCUSSION AND RECOMMENDATIONS 
Clarity is not a common attribute of the nurse practice acts reviewed. 
In many, if not most instances, a reading of a nurse practice 
act fails to make clear both the reach of the act and the exemptions to 
nurse practice licensing. A review of the regulatory language raises 
myriad questions about who exactly family caregivers are. What are 

405. CAL. HEALTH & SAFETY CODE § 2727 (West 1992). 
406. SABATINO, supra note 7, at 45, 55. 
407. See CALIFORNIA DSS MANUAL - SS, SERVICE PROGRAM No. 7: IN-HOME SUPPORTIVE 
SERVICES § 30-757.191 -.199 (1986). 
408. DATA PROCESSING & STATISTICAL SERVS. BUREAU, CALIFORNIA DEP'T OF SOCIAL 
SERVS., IN-HOME SUPPORTIVE SERVICES CHARACTERISTICS SURVEY 7, 10 (1987). 
409. SABATINO, supra note 7, at 29, 55. 
410. NEB. REV. STAT. § 71-1,132.06 (1992). 
411. IowA CODE ANN. § 152.1 (West 1989 & Supp. 1993). 
412. IND. CODE ANN. § 25-23-1-27.1 (West 1993). 

PAS LIABILITY ISSUES 335 

the definitions of domestic servant, housekeeper, companion, household 
aide, or related title? What are "family remedies"? Exactly what 
tasks may be delegated by a nurse and to whom? 

It is noteworthy that, regardless of nurse practice act provisions, 
many states provide what may be considered "nursing" or "paramedical" 
services under their Medicaid personal care option programs, 
without any mention of nurse delegation. Reviewing 133 PAS programs 
in existence throughout the United States in 1988 (including 
twenty-four Medicaid personal care option programs), the World Institute 
on Disability found the following proportions of PAS programs 
offering the types of assistance listed: 73% offered bowel and bladder 
assistance; 66% offered prosthesis assistance; 66% offered range of motion; 
63% offered menstrual assistance; 63% offered foot care; 57% offered 
assistance with medications; 48% offered assistance with 
respiration; 38% offered assistance with catheterization; and 33% offered 
assistance with injections.413 Unfortunately, these categories do 
not offer any measure of the level of involvement in any of these 
"nursing" tasks. For example, "assistance with medication" could 
mean merely handing the pills to an individual. Nevertheless, these 
substantial percentages raise some doubt about how closely nurse 
practice acts are followed in many states. 

A more accurate picture of the impact of nurse practice law 
might be obtained by directly surveying regulators and professionals 
in the field to find out how these acts are interpreted, implemented, 
and enforced. Rosalie Kane and colleagues recently used just such a 
methodology in examining nurse delegation in twenty states. 414 Her 
report concludes that nurse delegation policies are ambiguous and 
that delegation potential is not fully utilized, although experience 
with delegation to date has been free of serious problems. More importantly, 
Kane suggests that the interplay of many factors all affect 
the current and future role of nurse delegation in long-term care. Factors 
include: subtle differences in regulation; regulations governing 
specific programs, services and settings; nurse attitudes and nursing 
education; the attitudes of other players in the system (e.g., nursing 
homes); and reimbursement mechanisms.415 

413. Lnymc vr AL., supra note 4, at 17. 
414. See ROSALIE A. KANE ET AL., AMERICAN ASS'N OF RETIRED PERSONS, DELEGATION 
OF NURSING ACTIVTITES. IMPLICATIONS FOR PATTERNS OF LONG-TERM CARE 
(1995). 
415. Id. at 60-64. 

336 The Elder Law Journal 

Balancing safety and flexibility, nurse and physician delegation 
both appear to offer fruitful approaches under some threshold requirements 
of approval, training and/or supervision. However, 
where significant training and supervision are needed, nurse delegation 
is likely to be the more realistic mode, considering the limited 
involvement of physicians in home and community-based settings to 
oversee training and supervision. Physician delegation may be more 
suitable for that subset of persons with disabilities who, through experience, 
are already knowledgeable and skilled in the techniques of 
managing their personal assistance and nursing needs. In these cases, 
it may be more appropriate to permit physicians to certify that the 
individual with a disability is capable of training his or her own assistants. 
Although this may not be an option appropriate to the majority 
of consumers of PAS, it should not be denied to those experienced 
individuals who would prefer it. 

Oddly, most nurse practice acts currently appear to allow anyone 
employed as a domestic servant, housekeeper, or companion to 
perform nursing tasks entirely without delegation or oversight by any 
professional, at least as long as the worker does not hold himself or 
herself out as a professional nurse. Perhaps for clearly self-directing 
consumers, this option is indeed their right, particularly if the arrangement 
is established and paid for without public or private 
agency involvement. Under publicly funded PAS programs, it is 
more likely that program regulations will impose safeguards that begin 
to look similar to the nurse delegation approach. Recall, for example, 
the Pennsylvania attendant care program quoted above. The 
conditions for the performance of health maintenance activities by attendants 
address many of the same concerns as do delegation guidelines—
matters such as assessment, instruction, supervision, and 
monitoring. The underlying issue is what conditions and safeguards, 
if any, are appropriate. 

Under nurse delegation, our experience is insufficient to draw 
any hard and fast conclusions about optimum approaches, practical 
consequences, and legal ramifications. Existing law is quite varied 
and vague. And recent state attempts to expand nurse delegation options, 
such as in Oregon and Texas, reflect a certain amount of discomfort 
with nurse discretion. The more detailed the standards for 
assessment, training, oversight, and documentation, the lesser the 
level of discretion granted to both nurses and consumers, and the 


PAS LIABILITY ISSUES 337 

more costly the process. Whether there is a substantial payoff in quality 
as a result of such standards is unknown at present. 

Less detailed standards, such as those in New Jersey, may expand 
nurse discretion and flexibility but raise greater concerns about 
quality assurance. However, if any one theme has been consistent in 
home and community-based services, it is the reality that one size 
does not fit all. Detailed standards and procedures that must be applied 
to all consumers easily miss that reality. It may be possible 
when setting delegation guidelines to be clear that the guidelines are 
advisory rather than mandatory and that nurses have discretion to 
modify the protocol according to the abilities, circumstances, and preferences 
of the consumer. For example, if guidelines provide for a supervisory 
visit once per month, the delegating nurse could have 
discretion to lengthen or shorten that schedule according to the needs, 
abilities, and preferences of the consumer. Likewise, a rule that prohibits 
delegation of injectable medications perhaps should serve only 
as a presumption, modifiable by consumer choice and nurse 
discretion. 

The most salient liability concern for nurses in delegating care 
functions is the extent to which the nurse is liable for the acts of the 
delegatee. Most existing delegation guidelines emphasize that the 
nurse remains ultimately responsible for the care provided, but the 
scope of this responsibility is not entirely clear. It is essential that this 
scope be clear, because being responsible for the task of delegation is 
not the same as being responsible for the actual performance of the delegated 
task. For example, the New Jersey regulations make the nurse 
responsible for "exercising that degree of judgment and knowledge 
reasonably expected to assure that a proper delegation has been 
made."416 The Oregon regulations increase the duty of care of the 
nurse somewhat by making the nurse "strictly accountable for that 
delegation."417 However, both these rules focus on the task of delegation. 
In contrast, the Texas regulations state, "The RN shall be accountable 
and responsible for the delegated nursing task. "418 Hence, 
the Texas language imposes a greater duty of care, making the nurse 
responsible not only for the task of delegation but for the ongoing 
performance of the delegatee. 

416. N.J. ADMIN. CODE § 13:37-6.2(b) (1992). 
417. OR. ADMIN. R. § 851-47-000(11) (1992). 
418. TEX. ADMIN. CODE tit. 25, § 218.3(8) (1993). 

338 The Elder Law Journal 

Recall the discussion of direct and vicarious liability in section 

VI.B. Vicarious liability pursuant to the doctrine of respondeat superior 
describes the responsibility of an employer for the acts of his or 
her employees. If nurses are held responsible on this basis, then they 
would face a tremendous disincentive to use delegation, for they 
would be liable for any act of negligence by a delegate even if the 
nurse's training, supervision, and exercise of discretion in the case 
were flawless. Although not clear, the Texas language ("responsible 
for the delegated task") suggests that vicarious liability applies, even 
though the PA (the "delegatee") is not an employee of the nurse. The 
New Jersey and Oregon language suggests a lesser form of liability— 
that of direct liability for the delegation process only. Thus, if the 
worker to whom a task was delegated negligently harms the client, 
the nurse would be liable only if it were established that the nurse's 
assessment, training, supervision, or other aspect of the delegating 
process were performed negligently. These are matters of "direct" liability, 
not vicarious liability. 
At present, the implications of this distinction are largely theoretical. 
Kane's twenty-state survey found that in states that have 
made efforts to encourage nurse delegation in PAS settings, nurse liability 
problems have not materialized. 419 Of course, this may be due 
in part to the lack of information systems to track such problems, as 
well as the lack of extensive experience with delegation. Nevertheless, 
greater clarity in the law would help encourage the development 
of nurse delegation. A vicarious liability approach would probably 
discourage nurse delegation and impose an unrealistic obligation 
upon nurses, because they would bear all the responsibility for someone 
who is neither their employee nor subordinate nor subcontractor. 
It puts the nurse "between a rock and a hard place." The nurse has no 
real direct control over the day-to-day acts of the delegatee, yet is held 
strictly liable. Simply decreeing that the nurse is liable for the day-today 
acts of the delegatee does not necessarily produce any greater assurance 
of quality when, in fact, the nurse does not have the authority 
to control the acts of the delegatee. Their only real control is over the 
delegation process itself. A "direct" liability rule more reasonably reflects 
the professional role that nurses can play in delegating nurse 
functions in CD-PAS models. 

419. KANE ET AL., supra note 414, at 63. 

PAS LIABILITY ISSUES 339 

B. Licensure Issues and Recommendations 
1. RECOMMENDATIONS FOR REGULATORY LIABILITY (NURSE PRACTICE 
ACTS) 

First, states should take steps to develop more fully nurse and 
physician delegation options available to consumers who prefer having 
"nursing" tasks performed by unlicensed workers under PAS programs. 
Delegation options should seek an appropriate balance of 
flexibility, safety, and accountability tailored to the individual consumer. 
Options should include consideration of delegation of training 
and supervision responsibilities to self-directing consumers themselves. 
Second, states should ensure the direct involvement of consumers 
with disabilities, disability advocacy groups, and aging 
advocacy groups in the process of developing or expanding nurse and 
physician delegation options. Third, state nurse practice laws should 
clarify that delegating nurses and physicians are directly liable for the 
delegation tasks they perform (i.e., assessment, training, and supervision) 
but not vicariously liable for the acts of delegatees. 

2. LICENSURE ISSUES 
PAS historically have experienced minimal governmental regulation, 
although those regulations have nevertheless had significant 
consequences for PAS. Federal regulations for the optional personal 
care services benefit under Medicaid, though brief, have been criticized 
by many consumer advocates for placing limitations on the use 
of family providers and imposing a medically oriented bias to services 
delivery.42° Federal regulations require that such services be prescribed 
by a physician in accordance with the recipient's plan of treatment 
and provided by an individual who is qualified to provide the 
services, supervised by an RN, and not a member of the recipient's 
family.421 Most states providing personal care under Medicaid have 
instituted at least some basic qualification requirements and training 
for PAs.422 

Apart from federal program requirements, states traditionally 
have relied on licensure as the primary means of regulating home 

420. See NATHAN LINSK ET AL., WAGES FOR CARING: COMPENSATING FAMILY 
CARE OF THE ELDERLY (1992); DeJong et al., supra note 19, at 90. 
421. 42 C.F.R. § 440.170(f) (1994). 
422. DEBORAH LEWIS-IDEMA ET AL., DESCRIPTIVE STUDY OF MEDICAID PERSONAL 
CARE PROGRAMS 18-20 (Commonwealth Fund Commission on Elderly People Living 
Alone, Background Papers Series No. 21, 1990). 

340 The Elder Law Journal 

care.423 However, most state licensure regulations have focused on 
regulating home-health care under a definition of home health similar 
to that covered by Medicare. These definitions focus on the provision 
of skilled nursing plus one or more other therapeutic or supportive 
services. As of 1992, at least forty states licensed home-health care, 
while only twenty-two required licensure or certification of agencies 
that provide only personal assistance.424 Although still less than half 
the states, the number in this latter group has been growing. A 1986 
ABA survey of home-care licensure revealed only nine states that licensed 
these types of supportive service agencies.425 

With respect to CD-PAS in which the consumer is clearly 
deemed the employer, the question of licensure is particularly important 
with respect to agencies that might assume a fiscal or supportive 
intermediary role as opposed to a direct service provider role. As 
with employer-employee questions, a similar dilemma arises: how 
much can an intermediary agency do before it crosses a definitional 
line that makes it a provider of home care subject to licensure or certification? 
The question is not purely academic. Flanagan reported that 
Maine was faced with a challenge from home-health agencies who argued 
that Area Agencies on Aging and "Alpha One" (an independent 
living center), both of which sponsor CD-PAS programs, should be 
certified as home-health agencies, because "they seem to be performing 
duties very similar to the home-health agencies. "426 The Maine 
dispute appears to be moving toward a more specific demarcation of 
services that are "consumer-directed" and to licensure of multiple 
levels of home-care-aide services. 427 The danger in this kind of dispute 
is that a "consumer-directed" option could be relegated to a narrow, 
singular form of service delivery, rather than permitting multiple 
variations of the concept. 

423. SELECT COMM. ON AGING, THE "BLACK Box" OF HOME CARE QUALITY, H.R. 
Doc. No. 573, 99th Cong., 2d Sess. 32 (1986). 
424. NATIONAL ASS'N FOR HOME CARE, STATE LICENSURE AND CERTIFICATE OF 
NEED SURVEY 7-19 (1992). According to the survey, the states that license or certifyhome-care aide, personal-care aide, or homemakers agencies are Arizona, Arkansas, 
Colorado, Connecticut, Delaware, Georgia, Illinois, Indiana, Kansas, Minnesota, 
Montana, Nebraska, New Hampshire, New Jersey, New York, North 
Carolina, Oklahoma, Tennessee, Texas, Utah, Virginia, and Washington. 
425. SELECT COMM. ON AGING, supra note 423, at 58. 
426. FLANAGAN, supra note 30, at 25. 
427. Telephone Interview with Christine Gianopolous, Director of the Maine 
Bureau of Elder and Adult Services (July 7, 1994). 

PAS LIABILITY ISSUES 341 

In many states, licensure questions affecting intermediary agencies 
may be further complicated by the existence of other, related licensure 
schemes, such as licensure for employment agencies or other 
forms of placement service. For example, in New Jersey, consider a 
hypothetical agency undertaking the role of intermediary under a CDPAS 
program. In this role, the agency might recruit and screen PAs, 
refer them to consumers, and/or handle payroll functions. Although 
such an agency would not be deemed a home-health agency under 
New Jersey law, because the agency provides no skilled nursing, it 
nevertheless may be subject to licensing as an employment agency, a 
job-listing service, a nurse registry, or a temporary-help-service firm. 
New Jersey regulations define these entities as follows:428 

• "Employment agency" means any person who, through its 
agents or otherwise, for a fee, charge or commission: 
1. Procures, or obtains, or offers, promises or attempts to procure, 
obtain, or assist in procuring or obtaining employment for 
a job seeker or employees for an employer; 
2. Supplies job seekers to employers seeking employees on a 
part-time or temporary assignment basis who has not filed as a 
temporary help service pursuant to [New Jersey law]; 
4. Acts as a placement firm, career counseling service, or resume 
service; 
5. Acts as a nurses' registry . . . ; 
6. Places health care personnel in private homes or on private 
duty; or 
7. Places household workers in domestic positions, including 
salaried "nannies" or "au pairs." 
• "Job listing service" means any person required to be registered 
under [New Jersey law] who, by advertisement or other means, 
offers to provide job seekers with a list of employers, a list of 
job openings . . . or prepares resumes or lists of applicants for 
distribution to potential employers, where a fee or other valuable 
consideration is exacted . . . either directly or indirectly. 
• "Nurses' registry" means any person who operates a business 
which directly or indirectly procures, assigns, or supplies, or 
offers . . . temporary or permanent personnel service(s) classified 
as nursing and/or homemaker-home health services, and 
directly or indirectly receives ... a payment, fee, charge or commission 
for such service(s). 
• "Temporary help service firm" means any person who operates 
a business which consists of employing individuals directly or 
indirectly for the purpose of assigning the employed individuals 
to assist the firm's customers in handling of the customers' 
temporary, excess or special work loads, and who, in addition 
to the payment of wages or salaries to the employed individu428. 
All may be found at N.J. ADMIN. CODE § 13:45B-1.2 (1995). 

342 The Elder Law Journal 

als, pays or is required to pay Federal social security taxes and 
State and Federal unemployment insurance; carries or is required 
to carry worker's compensation insurance . . . and sustains 
responsibility for the actions of the employed individuals 
while they render services to the firm's customers. 

The consequences of regulation under any of these categories or 
similar categories in other states may or may not be conducive to encouraging 
the intermediary concept. Obviously, these regulatory systems 
were not devised with the intermediary agency function in 
mind, and each state is likely to be unique in its regulatory categories 
and their consequences. The nature and extent of regulation, if any, 
for CD-PAS intermediary agencies should be determined after sufficient 
experience in operating demonstration programs. Creating a 
new regulatory pigeonhole can have the effect of stifling an evolving 
long-term service option, making it more expensive and further fragmenting 
coordination among providers. For the present, a wiser 
course may be to use or create exemptions from state regulation for 
such programs. 

We could consider that a regulatory exemption is typically tied 
to program auspices (e.g., state-funded programs), or type of services 
provided (which, in this case, would be PAS intermediary agency 
services), or target population (e.g., self-directed consumers or perhaps 
consumers who have a stable, predictable condition and who require 
minimal nursing supervision). Of these options, an exemption 
based on the specific functions provided by the intermediary agency 
perhaps offers the most justifiable and narrowly circumscribed 
exemption. 

If a federal CD-PAS option is ever established under health reform, 
then the nature of intermediary agencies may develop more uniformly, 
especially if defined and regulated at the federal level. 
However, it remains more likely that states will have to confront these 
issues long before a federal response ever materializes. 

3. RECOMMENDATIONS ON AGENCY LICENSURE 
State law should expressly exclude from home-care licensing requirements 
intermediary agencies serving as fiscal agent or offering 
other supportive functions to consumers who wish to manage their 
own personal assistance. States should experiment with standards 
fashioned around only the specific responsibilities and functions of 
the intermediary. Federal and state policy should also recognize intermediary 
functions and grant greater flexibility to their operation 


PAS LIABILITY ISSUES 343 

than is currently permitted under existing Medicaid provider regulations. 
Federal and state policy should encourage development of a 
continuum of CD-PAS delivery options including cash payments directly 
to consumers, a fiscal agent option, and supportive intermediary 
option. 

VIII. Summary of Findings and Recommendations 
A. Personal Injury Liability 
1. RISK APPORTIONMENT 
a. Findings Government and private agency sponsors of CD-PAS 
programs have generally avoided addressing injury risks to consumers 
and PAS workers. Government and private agencies perceive the 
risk of injury to consumers as quite high, although the lack of reported 
litigation suggests that the risk is quite modest. Tort liability for personal 
injury to PAS consumers is closely linked to the employer role 
over PAS workers and legal concept of vicarious liability of the employer 
for the acts of employees. Just as government and private 
agencies have misperceived that the assumption of any employer-type 
functions necessarily leads to liability for all employer responsibilities, 
so too they have misperceived that it necessarily leads to liability for 
all personal injury to PAS consumers. Tort law deals with personal 
injury problems after injury occurs. The implementation of quality 
assurance strategies before injury occurs more effectively addresses 
personal injury concerns, especially with respect to persons who are 
not totally self-directing. For these consumers, the development of 
supportive intermediary options, described above, is most promising. 
See appendix 2 for a continuum of possible consumer-directed 
PAS models. 

b. Recommendations First, PAS programs should develop a service-
planning process that explicitly and clearly apportions responsibilities 
and risks of managing PAS (i.e., acting as an employer). The process 
should involve the consumer and the PAS program, supportive intermediary 
agency, or service/"case" manager and be based upon the 
concepts of consumer choice, informed consent, and assumption of 
risk. Second, federal and state PAS programs should further develop 
supportive intermediary options, described in subsection A.1 above, 
in order to give consumers more alternatives in apportioning em

344 The Elder Law Journal 

ployer-management responsibilities. Lastly, state law should recognize 
the fiscal agent and supportive intermediary status for purposes of 
protecting the state or designated intermediary agencies from tort liability 
under theories of vicarious liability applicable to actual or ostensible 
employers. Direct liability principles for failure to carry out 
designated functions should remain unchanged. 

2. INJURY TO PAS WORKERS 
a. Findings PAS programs generally do not provide workers' compensation 
coverage for PAS workers. State workers' compensation 
laws typically exempt coverage of PAS workers under categorical exemptions 
for domestic services or exemptions based upon minimum 
numbers of employees or work hours. State labor commissions are 
not familiar with the concept of intermediary agency for CD-PAS. 
b. Recommendation States should expressly cover all PAS workers 
and permit, by amendment if necessary, intermediary agencies to secure 
coverage as a single employer for all PAS workers as agent for 
self-directing consumers. 
B. Licensure and Certification Liability 
1. NURSE PRACTICE ACTS 
a. Findings A key area of regulatory tension involves the applicability 
of state nurse practice acts to workers who provide PAS. Nurse 
practice acts generally are not very clear on their face regarding the 
scope of actions that constitute professional nursing nor the exemptions 
to nurse licensing. Data on actual practices throughout the states 
are lacking. Nurse or physician delegation exceptions offer a fruitful 
policy direction for ensuring flexibility and acceptable levels of safety 
and accountability under PAS programs. A key liability issue for 
nurses or doctors in delegating nursing functions is the extent to 
which the nurse or doctor is liable for the acts of the delegatee. The 
scope of this liability is not clear under most existing delegation 
guidelines. 
b. Recommendations States should take steps to develop more fully 
nurse and physician delegation options available to consumers who 
prefer having "nursing" tasks performed by unlicensed workers 
under PAS programs. Delegation options should seek an appropriate 

PAS LIABILITY ISSUES 345 

balance of flexibility, safety, and accountability tailored to the individual 
consumer. Options should include consideration or delegation of 
training and supervision responsibilities to self-directing consumers 
themselves. Second, states should ensure the direct involvement of 
consumers with disabilities, disability advocacy groups, and aging advocacy 
groups in the process of developing or expanding nurse and 
physician delegation options. Third, state nurse practice laws should 
clarify that delegating nurses and physicians are directly liable for the 
delegation tasks they perform (i.e., assessment, training, and supervision), 
but not vicariously liable for the acts of delegatees. 

2. INTERMEDIARY AGENCY REGULATION 
a. Findings Intermediary agency models of PAS service delivery are 
relatively new and experimental. Considerable regulatory flexibility 
is needed to allow the optimum development of these models. However, 
intermediary agencies run the risk of being inappropriately miscategorized 
for regulatory purposes as a home care agency provider 
or as a form of employment agency or placement service. 
b. Recommendation State law should expressly exclude from home-
care-licensing requirements intermediary agencies serving as fiscal 
agent or offering other supportive functions to consumers who wish to 
manage their own personal assistance. States should experiment with 
standards fashioned around only the specific responsibilities and 
functions of the intermediary. Federal and state policy also should 
recognize intermediary functions and grant greater flexibility to their 
operation than is currently permitted under existing Medicaid provider 
regulations. Federal and state policy should encourage development 
of a continuum of CD-PAS delivery options including cash 
payments directly to consumers, a fiscal agent option, and supportive 
intermediary option. 

346 The Elder Law Journal 

APPENDIX 1 

NOTE: The Revenue Ruling refers to the "person or persons from whom the services are performed." 
For clarity, the term "consumer" is substituted below. 

Factors Indicating Employer-Employee

 

Relationship

1. Instruction. Does the consumer have 
the right to instruct the worker and require 
compliance with instructions regarding 
when, where, and how he or she is to 
work? 
2. Training. Does someone train the 
worker to perform services in a particular 
method or manner? 
3. Integration. Are the worker's services 
integrated into the "business operations" of 
the consumer? 
4. Service rendered personally. Must 
the services be rendered personally by the 
worker (as opposed to being delegable to 
someone else by the worker)? 
5. Hiring, Supervision, and Paying 
Assistants. Does the consumer hire, 
supervise and pay other assistants (as 
opposed to the worker hiring his/her own 
assistants or subcontractors)? 
6. Continuing Relationship. Are the 
services continuing or recurring? 
7. Hours of Work. Does the consumer set 
the worker's hours of work? 
8. Full-Time Required. Must the worker 
devote substantially full-time to the consumer 
receiving services? 
9. Employer's Premises. Does the consumer 
control where the services are provided? 
10.Setting Order or Sequence. Does the 
consumer set the order or sequence of the 
worker's services? 

11. Reports. Must the worker submit regular 
or written reports to the consumer or 
someone else? 
12. Payment Schedule. Does the worker 
get paid by the hour, week, or month (as 
opposed to by the job or commission)? 
13. Expenses. Does the consumer pay 
the worker's business and/or traveling 
expenses related to the services (but not 
routine commuting expenses)? 
Does Factor Apply to CD-PAS? 

Yes. 

Yes, either the consumer or a designated 
professional or agency typically provides 
some training. 

Yes, if "business operations" is translated 
to mean the day-to-day personal activities 
of the consumer. 

Yes. Substitution of attendants is generally 
acceptable only in case of illness or 
other unusual circumstances. 

Usually not applicable, or if applicable, the 
consumer usually hires other help. 

Yes. 

Yes, if services are consumer-directed. 
The PAS program may also set a cap. 

Usually no, but quite variable according to 
consumer's need and PAS funding. 

Yes. Location is dictated by the con-
sumer's physical location. 

Varies, but generally yes, to a substantial 
degree. 

Generally no, except perhaps for 
timesheets. 

Yes. 

Yes, although which kinds of expenses are 
paid for may vary widely. 


PAS LIABILITY ISSUES 347 

Factors Indicating Employer-Employee 
Relationship Does Factor Apply to CD-PAS? 

14. Furnishing Materials. Does the con- Generally yes—e.g., lifts, medical supsumer 
furnish significant tools, materials, plies, cleaning and cooking supplies. 
or other equipment used by the worker? 
15. Investment. Does the worker lack a Generally yes. 
financial investment in the facilities used? 
16. Profit & Loss. Is the worker free of Yes. 
risk of financial gain or loss due to service-
related investment? 
17. Working for More Than One Firm. Variable. 
Does the worker work only for the consumer 
or the PAS entity (as opposed to 
working for multiple unrelated persons or 
firms)? 
18. Available to General Public. Is it true Yes. PAS workers generally work on a 
that the worker does not hold out his or her long-term basis for one or a few consumservices 
as available to the general public ers. 
on a regular and consistent basis? 
19. Right to Discharge. Does the con- Yes. 
sumer (or PAS entity) have the right to discharge 
the worker? 
20. Worker Right to Terminate. Does the Yes. 
worker have the right to terminate his or 
her relationship with the consumer without 
incurring liability? 

APPENDIX 2: Continuum of Possible Consumer-Directed PAS Models 

Intermediary Agency Options 

or 
Use of "Managing Employer" (consumer) vs. "Limited Employer" 
Cash Grant to Consumer (agency) distinction 

Fiscal Agent Supportive Intermediary 

= Cash grant or voucher with or = Agency that handles Employer = Fiscal Agent role plus 
w/o counseling or service payroll obligations. additional management tasks per 
coordination component agreement with consumer. 

* * * * * * * * * * * * * * * 

Consumer is Employer Fiscal Agent is not employer, Intermediary is not employer, 
although status of limited co-although status of limited coemployer 
could be used. employer could be used. 
Consumer is Employer (or Consumer is Employer (or 


Managing co-employer). Managing co-employer). 

Agency Models 

= Private/Public agency 
providers with clear consumer-
directed mandate & philosophy 
or 
A private consumer cooperative 
provider with consumer 
management/control of the 
agency. 

* * * * * 

Agency and consumer are both 

managing co-employers. 


APPENDIX 3: Nurse Practice Acts Exemptions for Unlicensed Persons 

State 

ALABAMA 
ALA. CODE § 3421-
6 (1989) 


ALASKA 
ALASKA STAT. 
§ 08.68.400, 
.410(8) (1993). 
ALASKA ADMIN. 
CODE tit. 12, 
§ 44.770 & Appendix 
D (1992) 


ARIZONA 
ARIZ. REV. STAT. 
ANN. § 32-1601(7) 


(d) (1995). Board 
of Nursing Rules 
R4-19-402 (1987) 
Care of the Sick Domestic Care by 
Care of the Sick by 
Friends and Family 
by Domestic 
Servants 
Administration of 
Family Remedies 
Employee of 
Institution 
Gratuitous nursing of 
the sick by friends or 
members of the family. 


Care Under Direction of 
RN 

Definition of nursing 
practice includes delegation. 
Definition of unprofessional 
conduct includes 
improper delegation and 
supervision. (Delegation 
guidelines in Appendix to 
regulations) 

Definition of nursing 
practice includes "supervision 
and teaching of 
other personnel." 
Regulations provide that 
nurses may: assign specific 
nursing duties to 
other qualified personnel; 
assign the administration 
of medications to other 
licensed nurses only; 
assign the duties or rendering 
treatments to 
licensed nurses, and/or 
auxiliary workers based 
upon their educational 
preparation and experience. 


Care Under Direction 
of Physician or 

Other Personnel 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
CJl 
O 
ARKANSAS 
ARK. CODE ANN. 
§ 17-87-102(2)(c) 
(Michie 1995) 
Definition of nursing 
practice includes "supervision 
and teaching of 
other personnel." 
a. 
CALIFORNIA 
CAL. HEALTH & 
SAFETY CODE 
§ 2727 & § 2728 
(West 1992). 
CAL. CODE REDS. 
tit. 16, § 1443.5(4) 
(1992) 
Gratuitous nursing of 
the sick by friends or 
members of the family. 
Incidental care of 
the sick by domestic 
servants or by 
persons primarily 
employed as 
housekeepers as 
long as they do 
not practice nursing 
within the 
meaning of this 
chapter. 
Domestic administration 
of family 
remedies by any 
person. 
Attendants and 
technicians in 
institutions under 
the jurisdiction or 
subject to visitstion 
by the state 
departments of 
health, mental 
health, developmental 
services, or 
corrections. 
Regulation on standards 
for competent performance 
recognize that a 
nurse, 'Delegates tasks to 
subordinates based on the 
legal scope of practice of 
the subordinates and on 
the preparation and capability 
needed in the tasks 
to be delegated...." 
Performance by any 
person of such duties 
as required in the 
physical care of a 
patient and/or carrying 
out medical 
orders prescribed by a 
licensed physician; 
provided, such person 
shall not in any way 
assume to practice as 
a professional, registered, 
graduate or 
trained nurse, 
O 
COLORADO 
Cow. REV. STAT. 
§§12-38-103(10), 
38-125, 38-132 
(1995) 
Gratuitous care of 
friends or members of 
the family. 
Care of the sick by 
domestic servants, 
housekeepers, 
companions or 
household aides of 
any type ... who 
shall not assume 
in any way to 
practice prof'l 
nursing. 
Domestic administration 
of family 
remedies. 
Definition of nursing 
practice includes delegation. 
Delegation provision 
states that nurse "may 
delegate any task 
included in the practice of 
professional nursing . .. 
subject to the requirements 
of this section." 
(Guidelines provided) 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
CONNECTICUT 
CONN. GEN. STAT. 
Care of persons in 
their homes by 
. . . nor shall this 
chapter prohibit 
§ 20-101 (West domestic servants, any person from 
1995) housekeepers, 
nursemaids, corn-
the domestic 
administration of 
panions, attendants 
or household 
aides of any type 
... if such persons 
are not inifamily 
remedies or 
the furnishing of 
assistance in the 
case of an emergency. 
tially employed in 
a nursing capacity. 
DELAWARE 
DEL. CODE ANN. tit. 
19, §§ 1902, 1921 
(1993) 
Care of the sick in 
private homes by 
members of the family, 
friends, domestic 
servants or personsprimarily employed as 
housekeepers. 
(Same as Friends 
and Family.) 
Definition of nursing 
practice includes delegation. 
Exemptions include: Auxiliary 
care services performed 
by nurses' aides 
and other aux. workers in 
medical care facilities or 
(Same as for Care 
Under Direction of 
RN) 
elsewhere by persons 
under the direction and 
supervision of a person 
licensed to practice nursing, 
medicine, dentistry, 
or podiatry and performing 
those services which 
are routine, repetitive and 
limited in scope, and that 
do not require the professional 
judgment of an RN 
or LPN. 
cn 
cn 
t-
Crt 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
FLORIDA 
FLA. STAT. ANN. 
§§464.003(3), 
.022 (West 1993) 
The care of the sick 
by friends or members 
of the family 
without compensation. 
The incidental care 
of the sick by 
domestic servants, 
or the incidental 
care of non-insti-
Definition of nursing 
practice includes "supervision 
and teaching of 
other personnel." 
tutionalized persons 
by a 
surrogate family. 
GEORGIA 
GA. CODE ANN. 
§ 43-26-12 (1994) 
Incidental care of the 
sick by members of 
the family, friends, or 
persons primarily utilized 
as housekeepers 
provided that such 
care does not constitute 
the practice of 
nursing within the 
meaning of this article. 
(Same as Friends 
and Family.) 
The performance of auxiliary 
services in the care of 
patients when such care 
and activities do not 
require the knowledge 
and skill required of a 
person practicing nursing 
as a registered professional 
nurse and when 
such care and activities 
are performed under 
order or directions of a 
licensed physician . . . or 
person licensed to practice 
nursing as a registered 
professional nurse. 
HAWAII Definition of nursing 
HAW. REV. STAT. 
§ 457-13 (1990) 
HAW. ADMIN. 
RULES § 16-89-60 
(7)(F) (1990) 
includes delegation. 
Unprofessional conduct 
includes "failing to supervise 
persons to whom 
nursing functions have 
been delegated under 
one's supervision." 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee ofInstitution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
IDAHO 
IDAHO CODE §§ 541402(
b), -1411 
(1994) 
Medical attendants 
used by Dept. of 
Corrections. 
Definition of nursing 
practice includes: authorizing 
nursing interventions 
that may be 
performed by others and 
that do not conflict with 
this act. 
ILLINOIS 
225 ILL. COMP. 
STAT. § 65/4(e), (f) 
(West 1993). 
ILL. ADMIN. CODE 
tit. 68, § 1300.42 
(1990) 
The incidental care of 
the sick by members 
of the family, domestic 
servants or housekeepers. 
(Same as Friends 
and Family.) 
Plus ... 
Nursing aides, 
attendants, orderlies, 
and other 
auxiliary workers 
in private 
homes. .. . 
Nursing aides, 
attendants, orderlies, 
and other 
auxiliary workers 
in ... long term 
care facilities, nurseries, 
hospitals or 
other institutions. 
Standards of conduct 
require that RN "delegates 
tasks only to individuals 
whom the 
licensee knows or has reason 
to know are qualified 
by education or experience 
to perform." 
INDIANA 
IND. CODE ANN. 
§ 25-23-1-27.1(b) 
(4), (b)(5)(A), (b) 
(5)(B), (b)(5)(c) 
(1993) 
The gratuitous care of 
sick, injured, or infirm 
individuals by friends 
or the family of that 
individual. 
The care of the 
sick, injured, or 
infirm in the home 
for compensation 
if the person 
assists only ... 
with personal 
care. 
The care of the 
sick, injured, or 
infirm in the home 
for compensation 
if the person 
assists only . . . in 
the administration 
of a domestic or 
family remedy. 
Definition of nursing 
practice includes delegation. 
Exemptions include: the 
performance of tasks by 
persons who provide 
health care services which 
are delegated or ordered 
by licensed health professionals, 
if the delegated or 
ordered tasks do not 
(Same as Care Under 
Direction of RN) 
exceed the scope of practice 
of the licensed health 
professionals under Indiana 
law. 
rri 
cr) 
Cu 
Ui 
Lu 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
IOWA 
lowA CODE ANN. 
§ 152.1 (West 
1993) 
The performance 
of services by 
employed workers 
in offices, hospitals, 
or health care 
facilities... , 
under the supervision 
of a physician 
Definition of nursing 
practice includes 
"[s]upervis[ing] and 
teach[ing] other personnel 
in the performance of 
activities relating to nursing 
care." 
or a nurse.. .. 
KANSAS 
KAN. STAT. ANN. 
§ 65-1124 (1992) 
Gratuitous nursing by 
friends or members of 
the family. 
The incidental care 
of the sick by 
domestic servants 
or persons primarily 
employed as 
housekeepers. 
Plus ... 
Performance of 
Performance of a nursing 
task by a person when 
that task is delegated by a 
licensed nurse, within the 
reasonable exercise of 
independent nursing 
judgment, and is performed 
with reasonable 
attendant care 
services directed 
by or on behalf of 
an individual in 
skill and safety by that 
person under the supervision 
of a registered professional 
nurse. 
need of in-home 
care as the terms 
"attendant care 
services" and 
"individual in 
need of in-home 
care" are 
defined. .. 
KENTUCKY Definition of nursing 
Ky . REV. STAT. 
ANN. § 314.011 
practice includes delegation. 
(Baldwin 1992) 


Care of the Sick Domestic Care by Care Under Direction 
Care of the Sick by by Domestic Administration of Employee of Care Under Direction of of Physician or 
State Friends and Family Servants Family Remedies Institution RN Other Personnel 

LOUISIANA 
LA. REV. STAT. 
ANN §§ 37:913, 
:929 (West 1990) 


MAINE 
ME. REV. STAT. 
ANN. tit. 31 
§§2102(D), (G) & 
2103 (West 1985) 


MARYLAND 
MD. CODE ANN. 
HEALTH Occ. § 8101(
f) 
MD. REGS. CODE 
§§10.27.09.03, 
.27.11 (1994) 


Gratuitous nursing by 
friends or members of 
the family. 

Incidental care of 
the sick by domestic 
workers or persons 
primarily 
employed as 
housekeepers as 
long as they do 
not practice nursing. 


Definition of nursing 
practice includes delegation. 


Definition of nursing 
practice includes delegation 
of selected nursing 
services to assistants to 
nurses who have completed 
or are currently 
enrolled in a course sponsored 
by a state-approved 
facility or a facility 
licensed by the Department 
of Human Services, 
and teaching activities of 
daily living to care providers 
designated by the 
patient and family. 

8 

Definition of nursing cn 
practice includes delega-cn 
tion. 
Standards of practice provide 
for delegation. co5 
(Guidelines provided) 

C 

(/) 

Crl 

C71 


Care of the Sick Domestic Care by Care Under Direction 
State 
Care of the Sick by 
Friends and Family 
by Domestic 
Servants 
Administration of 
Family Remedies 
Employee of 
Institution 
Care Under Direction of 
RN 
of Physician or 
Other Personnel 
MASSACHUSETTS The gratuitous care of The gratuitous The performance Definition of nursing 
MASS. GEN. LAWS 
ANN. ch . 112, 
§ 80B (West 
1988). 
any ill, injured or 
infirm person by any 
member of his family 
or any friend ... 
care of any ill, 
injured or infirm 
person by any 
member of his 
of any nursing 
service for any 
patient in a convalescent 
or nursing 
practice includes "teaching 
or supervising others" 
and "delegation of 
selected activities to unli-
MASS. REGS. CODE 
tit. 244, § 3.05 
family or any 
friend, or his care 
home or rest 
home, by any percensed 
assistive personnel." 
(West 1994) by any person son employed in Regulation defines unliemployed 
primarsuch 
home, procensed 
personnel to 
ily as a companvided 
that such include "nurses' aides, 
ion, housekeeper, nursing service is orderlies, assistants, 
domestic servant performed under attendants, technicians, 
or nursemaid. the supervision of home health aides, and 
an RN or LPN. other health aides." 
MICHIGAN Definition of nursing 
MICH. COMP. LAWS 
ANN. §§ 333.17201 
practice includes delegation. 
(West 1994). Separate provision pro-
Board of Nursing vides: A nurse [licensee] 
Rules ... may delegate to a 
R3338.10104 licensed or unlicensed 
(1991) individual who is otherwise 
qualified by education, 
training, or 
experience the performance 
of selected acts, 
tasks, or functions where 
the acts, tasks, or functions 
fall within the scope 
of practice of the licensee's 
profession and will 
be performed under the 
licensee's supervision. 
(Further guidelines provided) 



Care of the Sick Domestic Care by Care Under Direction 
State 
Care of the Sick by 
Friends and Family 
by Domestic 
Servants 
Administration of 
Family Remedies 
Employee of 
Institution 
Care Under Direction of 
RN 
of Physician or 
Other Personnel 
MINNESOTA 
MINN. STAT. ANN. 
Exemptions include: the 
provision of a nursing or 
§ 148.171 (West 
1991) 
nursing-related service by 
a nursing assistant who 
has been delegated the 
specific function and is 
supervised by an RN or 
monitored by an LPN. 
"Nursing assistant" means 
an individual providing 
nursing or nursing-related 
services that do not 
require the specialized 
knowledge and skill of a 
nurse, at the direction of 
a nurse. .. ." 
MISSISSIPPI 
Miss. CODE ANN. 
Gratuitous nursing by 
friends and members 
Definition of nursing 
practice includes delega§
§73-15-5, 73-157 
(Lawyers Co-op. 
1989). 
Board of Nursing 
Rules Ch. 3, 
of the family. tion. Regulation describes 
delegation function of 
nurses. 
§§ 1.3 & 1.3 
(1993) 
MISSOURI 
Mo. REV. STAT. 
§§ 335-016(8), 
.081 (West 1993). 
Also, 1991 Op. 
Att'y Gen. 25-91 
Nursing care by 
friends or members of 
the family of the person 
receiving such 
care. 
Incidental care of 
the sick, aged, or 
infirm by domestic 
servants or persons 
primarily 
employed as 
housekeepers. 
Services rendered 
by technicians, 
nurses' aides or 
their equivalent 
trained and 
employed in public 
or private hospitals 
and licensed 
long-term care 
facilities. .. 
Definition of nursing 
practice includes "teaching 
and supervising of 
other persons in the performance 
of professional 
nursing." 
injectables other 
than insulin. 


State 
Care of the Sick byFriends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee ofInstitution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
MONTANA 
MONT. CODE ANN. 
§§ 37-8-102, -103 
Gratuitous nursing by 
friends or members of 
the family. 
Definition of nursing 
practice includes delegation. 
(1992) 
NEBRASKA 
NEB. REV. STAT. 
§§71-1,132.05, 
-.06 (1992) 
Home care provided 
by parents, foster 
parents, family or 
friends so long as 
such persons do not 
represent or hold 
themselves out to be 
Definition of nursing 
practice includes delegation. 
Auxiliary services 
provided by persons 
carrying out duties 
necessary for the support 
of nursing services 
under the 
direction of a licensed 
licensed nurses, 
licensed practical 
nurses, licensed registered 
nurses, or use 
physician, dentist, 
osteopathic physician, 
podiatrist or a nurse. 
any designation in 
connection with their 
names which tends to 
imply that they are 
licensed to practice. 
NEVADA 
NEV. REV. STAT. 
§ 632.340 (Michie 
1991). 
NEV. ADMIN. CODE 
§ 632.222 (1992) 
Gratuitous nursing by 
friends or by members 
of the family of a 
patient. 
The incidental care 
of the sick by 
domestic servants 
or persons primarily 
employed as 
housekeepers as 
long as they do 
not practice nursing 
within the 
meaning of this 
chapter. 
Definition of nursing 
practice includes the 
"supervision and teaching 
of other personnel." 
Standards of practice provide 
that a registered 
nurse may delegate nursing 
care to other nurses 
and supervise other personnel 
in the provision of 
care if those persons are 
qualified to provide that 
care. (Guidelines provided) 



State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
NEW HAMPSHIRE Definition of nursing 
N.H. REV. STAT. practice includes delega-
ANN. §§ 326-B:2, tion. 
-B:17 (Michie Butterworth 
1995) 
Board of Nursing 
Rules Ch. Nur 
101.13 & .14 
(1988) 
NEW JERSEY 
N.J. REV. STAT. 
§ 45:11-23 (West 
1992). 
N.J. ADMIN CODE 
tit. 13, § 37-6.2 
(West 1992) 
Gratuitous care by 
friends or members of 
the family of a sick or 
infirm person. 
Incidental care of 
the sick by a person 
employed primanly 
as a 
domestic or 
housekeeper, 
notwithstanding 
that the occasion 
for such employment 
may be sickness, 
if such 
Services performed 
by nurses 
aides, attendants, 
orderlies and 
ward helpers in 
hospitals, institubons 
and agencies 
or by technicians, 
physiotherapists 
or medical secretaries. 
Nurse may delegate 
selected nursing tasks to 
... "ancillary nursing 
personnel." 
"Ancillary nursing personnel" 
includes aides, 
assistants, attendants and 
technicians. (Guidelines 
provided) 
incidental care 
does not constitute 
professional nursing 
and such person 
does not claim 
or purport to be a 
licensed nurse. 


Care of the Sick by 
State Friends and Family 

NEW MEXICO 

N.M. STAT. ANN. 
§§61-3-3(I), -29 
(Michie 1992). 
Board of Nursing 
Rules Art. IV, 
§ A2. 
New YORK 

N.Y. PUB. HEALTH 
LAW § 6908 
(McKinney 1993). 
Board of Regents 
Rules, Part 29. 
Care of the Sick 
by Domestic 
Servants 

Any person working 
as a home 
health aide, unless 
performing acts 
defined as professional 
nursing or 
practical nursing. 
... Any nursing 
aide or orderly 
unless performing 
acts defined as 
professional nursing 
or practical 
nursing. 

. . . 

Care of the sick by 
any person provided 
such person 
is employed primarily 
in a 
domestic capacity 
and does not hire 
himself or herself 
out or accept 
employment as a 
person registered 
to practice nursing. 
.. . 

Domestic Care by 
Administration of Employee of
Family Remedies Institution 


The domestic 
administration of 
family remedies. 

Care Under Direction of 

RN 

Definition of nursing 
practice includes delegation. 
Standards or practice regulation 
provides guidelines. 


Regulations defining 
unprofessional conduct 
include delegating professional 
services to a person 
when the licensee delegating 
such responsibilities 
knows or has reason to 
know that such person is 
not qualified, by training, 
by experience or by licensure, 
to perform them. 

Care Under Direction 
of Physician or 

Other Personnel 

Performance by a personal 
care provider in 
a noninstitutional setting 
of bowel and 
bladder assistance for 
an individual whom a 
health care provider 
certifies is stable, not 
currently in need of 
medical care and able 
to communicate and 
assess his own needs. 


Care of the Sick Domestic Care by Care Under Direction 
Care of the Sick by by Domestic Administration of Employee of Care Under Direction of of Physician orState Friends and Family Servants Family Remedies Institution RN Other Personnel 

NORTH CAROLINA 

N.C. GEN. STAT. 
§§ 90-171.20(7), 
.43 (Michie 1995) 
NORTH DAKOTA 

N.D. CENT. CODE 
§§43-12.1-02, -04 
(Michie 1993) 
OHIO 
OHIO ADMIN. CODE 
§§4723.02, .32 
(Anderson 1994) 

A person who provides 
nursing care or 
performs nursing 
functions or nursing 

tasks for an immediate 
family member. 

The provision of nursing 
services to family 
members. 

The activities of 
persons employed 
as nursing aides, 
attendants, orderlies, 
or other auxiliary 
workers in 
patient homes, 
nurseries, nursing 
homes, hospitals, 
home health agencies, 
or other similar 
institutions. 

Definition of nursing 
practice includes delegation. 


Definition of nursing 
practice and standards for 
practice include delegation 
(no guidelines). 

Definition of nursing 
practice includes delegation. 


Delegation to any person, 
including a meinber 
of the patient's 
family, by a physician 
licensed to practice 
medicine in NC, a 
licensed dentist or 
registered nurse of 
those patient care 
services which are 
routine, repetitive, 
limited in scope that 
do not require the 
professional judgment 
of an RN or LPN. 

The rendering of medical 
assistance to a 
licensed physician, 
licensed dentist, or 
licensed podiatrist by 
a person under the 
direction, supervision, 
and control of such 
licensed physician, 
dentist, or podiatrist. 


Care of the Sick Domestic Care by Care Under Direction 
Care of the Sick by by Domestic Administration of Employee ofCare Under Direction of of Physician orState Friends and Family Servants Family Remedies Institution RN Other Personnel 

OKLAHOMA 
OKLA. STAT. ANN. 
tit. 59 §§ 567.3, 
.11(4) (West 1989 
& Supp. 1996) 


OREGON 
OR. REV. STAT. 
§ 678.010 (1995). 
OR. ADMIN. R. 
§§851-47-000 to 
030 (1992) 


PENNSYLVANIA 
PA. CONS. STAT. 
§4 (1951) 

Homecare of the sick (Same as Friends 
by friends, domestic and Family.) 
servants, nursemaids, 
companions or household 
aides of any 
type. 


The performance 
by any person of 
such duties as 
required in the 
physical or mental 
care of a patient 
and/or carrying 
out medical orders 
prescribed by a 
licensed physician 
in a currently 
licensed hospital 
or a currently 
licensed nursing 
home, or state 
institution. 

Definition of nursing 
practice includes "delegating 
such tasks as may 
safely be performed by 
others, consistent with 
educational preparation." 

Definition of nursing 
practice includes delegation. 
Extensive guidelines 
provided in regulation. 

Rendering nursing 
care in the recipient's 
own home by a person 
certified as qualifled 
to perform such 
services by a licensed 
medical or osteopathic 
physician in any program 
of medical care 
or other program 
financed by the 
Department of 
Human Services provided 
that such person 
shall not hold 
herself or himself out 
to the public as a registered 
graduate, 
trained professional or 
licensed practical 
nurse. 


State 
RHODE ISLAND 

R.I. GEN. LAWS 
§ 5-34-31 (1995) 
SOUTH CAROLINA 

S.C. CODE ANN. 
§ 40-33-10(g) & 
-50 (Law Co-op. 
1986 & Supp. 
1995) 
Care of the Sick by 

Friends and Family 

Nursing by friends or 
members of the family 
or care of the sick by 
domestic servants, 
housekeepers, nursemaids, 
companions, or 
household aides of 
any type whether 
employed regularly or 
because of an emergency 
as long as the 
person does not hold 
him/herself out as a 
registered or practical 
nurse. 

Gratuitous nursing by 
friends or members of 
the family. 

Care of the Sick 
by Domestic 
Servants 

(Same as Friends 
and Family.) 

Incidental care of 
the sick by domestic 
servants or persons 
primarily 
employed as 
housekeepers as 
long as they do 
not practice nursing 
within the 
meaning of this 
chapter. (See definition 
of nursing.) 

Domestic Care by Care Under Direction 
Administration of Employee of Care Under Direction of of Physician orFamily Remedies Institution RN Other Personnel 

Definition of nursing 
practice includes delegation. 



State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
SOUTH DAKOTA 
S.D. CODIFIED 
LAWS ANN. §§ 369-
3, -28 (1992) 
Gratuitous care of 
friends or members of 
the family. 
Care of the sick by 
domestic servants, 
housekeepers, 
companions or 
household aides of 
any type whether 
employed regularly 
or because of 
an emergency or 
illness, but who 
do not assume to 
practice nursing as 
defined in this 
chapter. 
Domestic administration 
of family 
remedies. 
The administration 
of medications by 
aides within nursing 
homes, supervised 
living 
facilities or health 
care facilities 
under the jurisdiction 
of the Department 
of Human 
Services.... 
Definition of nursing 
practice includes delegation. 
Standards of practice regulation 
provides: The 
nurse may delegate to 
another only those nursing 
interventions which 
that person is prepared or 
qualified to perform and 
shall provide minimal or 
direct supervision to 
others to whom nursing 
interventions are delegated. 
(No further guidelines) 
TENNESSEE 
TENN. CODE ANN. 
§§63-7-102, -103 
(1990). 
The domestic 
administration of 
family remedies. 
Persons employed 
in institutions, 
agencies, or the 
office of a licensed 
Definition of nursing 
practice included "supervising 
and teaching of 
others." 
BOARD OF NURSING 
RULES § 1000-1.
13 (1988) 
physician or den-
fist, assisting in 
the nursing care of 
patients where 
adequate medical 
or nursing supervision 
or both is 
provided. 
Unprofessional conduct 
rule includes: assigning 
unqualified persons to 
perform functions of 
licensed persons or delegating 
nursing care functions 
and tasks and/or 
responsibilities to others 
contrary to the nurse 
practice act or rules and 
regulations to the detriment 
of patient safety; 
and failing to supervise 
persons to whom nursing 
functions are delegated or 
assigned. 


State 
Care of the Sick by 
Friends and Family 
Care of the Sick 
by Domestic 
Servants 
Domestic 
Administration of 
Family Remedies 
Care by 
Employee of 
Institution 
Care Under Direction of 
RN 
Care Under Direction 
of Physician or 
Other Personnel 
TEXAS 
TEX. REV. Civ. 
STAT. ANN. § 4528 
(West 1996). 
25 TEX. ADMIN. 
CODE §§ 217.11, 
218 (1996) 
Gratuitous nursing of 
the sick by friends. 
Delegation permitted by 
Board of Nurse Examiners 
regulations and Memorandum 
of Agreement 
with Department of 
Health. (Guidelines provided) 
Acts done under the 
control or supervision 
or at the instruction of 
one licensed by the 
Texas State Board of 
Medical Examiners 
(i.e., physician). 
UTAH Friends or members Definition of nursing 
UTAH CODE ANN. 
§§58-31-2(15), -6 
(1994) 
of the family of a 
patient performing 
gratuitous nursing care 
for the patient. 
practice includes delegation. 
Definition of unprofessional 
conduct includes 
unalwful or inappropriate 
delegation of nursing 
care. 
VERMONT 
VT. STAT. ANN. tit. 
§§1572, 83 
(1992). 
BOARD OF NURSING 
RULES Ch. 2. 
Care of the sick by 
domestic help of 
any type, whether 
employed regularly 
or because of 
illness, provided 
such person is 
employed primarily 
in a domestic 
capacity. 
Definition of nursing 
practice includes delegation. 
"Delegation" defined in 
regulation as nurses 
entrusting the performance 
of selected nursing 
tasks to competent 
subordinate persons in 
selected situations. The 
nurse retains the accountability 
for the total nursing 
care of the individual. 


Care of the Sick Domestic Care by Care Under Direction 
Care of the Sick by by DomesticAdministration of Employee ofCare Under Direction of of Physician or 
State Friends and Family Servants Family Remedies Institution RN Other Personnel 

VIRGINIA 
VA. CODE ANN. 
§§ 54-1-3000, 
-3001 (Michie 
1995). 
BOARD OF NURSING 
VR495-01-01, 
§ 4.1 


WASHINGTON 
WASH. REV. CODE 
ANN. §§ 18.79.040, 
-.240, -.260 (West 
1989 & Supp. 
1996). 


General care of 
the sick by nursing 
assistants, 
companions or 
domestic servants 
that does not constitute 
the practice 
of nursing as 
defined in this 
chapter. 

Incidental care of 
the sick by domestic 
servants or persons 
primarily 
employed as 
housekeepers, so 
long as they do 
not practice registered 
nursing 
within the meaning 
of this chapter. 

The domestic (Same as nurse 
administration of delegation.) 
family remedies. 

Definition of nursing 
practice includes "supervision 
and teaching of 
those who are or will be 
involved in nursing care." 
Definition of unprofessional 
conduct includes 
"employing or assigning 
unqualified persons to 
perform functions that 
require a licensed practitioner 
of nursing." 

Definition of nursing 
practice includes delegation. 
Exemptions include auxiliary 
services provided by 
persons carrying out 
duties necessary for the 
support of nursing services, 
including those 
duties that involve minor 
nursing services for persons 
performed in hospitals, 
nursing homes, or 
elsewhere under the 
direction of licensed physicians 
or the supervision 
of licensed RNs. 

(Same as for Care 
Under Direction of 
RN) 


Care of the Sick Domestic Care by 
Care of the Sick by by Domestic Administration of Employee ofState Friends and Family Servants Family Remedies Institution 

WEST VIRGINIA 

W. VA. CODE 
§§30-7-1, -12 
(1994). 
Board of Examiners 
for Registered 
Prof'I Nurses 
Rules § 19-10-3 
(1994) 
Care Under Direction of 
RN 

Definition of nursing 
practice includes "supervision 
and teaching of 
other persons...." 

Standards of practice regulation 
provide that a 
"nurse shall delegate to 
another only those nursing 
measures which that 
person is prepared or 
qualified to perform ..." 
and "shall supervise 
others to whom nursing 
interventions are delegated 
. .." and "shall 
retain professional 
accountability for nursing 
care when delegating 
...." 

Care Under Direction 
of Physician or 

Other Personnel 


State 

WISCONSIN 
Wisc. STAT. ANN. 
§§, 441-11, -115 
(West 1988 & 
Supp. 1995). 
WIS. ADMIN CODE 
[Board of Nursing] 
§ N6.03(3) (West 
1988 & Supp. 
1995) 


WYOMING 
Wyo. STAT. §§ 3321-
120(a)(ix), -154 


(iii) (1994) 
BOARD OF NURSING 
RULES Ch. III, 
§ 2(b) (1994) 
Care of the Sick by 
Friends and Family 


Nursing by friends, 
members of the fainily. 
(and) 
Members of religious 
communities or orders 
having charge of hospitals 
or taking care of 
the sick in their own 
homes. 

Incidental health care 
by members of the 
family and friends. 

Care of the Sick Domestic Care by 
by Domestic Administration of Employee of 
Servants Family Remedies Institution 

Care Under Direction of 
RN 

Definition of nursing 
practice includes "supervision 
and direction of 
licensed practical nurses 
and less skilled assistants." 
Under standards of practice 
regulation, nurse 
shall: delegate tasks commensurate 
with educational 
preparation and 
demonstrated abilities of 
the person supervised; 
provide direction and 
assistance to those supervised; 
observe and monitor 
the activities of those 
supervised; and, evaluate 
the effectiveness of acts 
performed under supervision. 


Definition of nursing 
practice includes delegation. 
Under standards of practice 
regulation, nurse 
shall: "delegate to another 
only those nursing interventions 
which a person 
is prepared or qualified to 
perform; ... provide 
direction and supervision 

.; retain professional 
accountability. ..." 

Care Under Direction 

of Physician or 

Other Personnel 

•