In November, the U.S. Department of Veterans Affairs announced significant cuts for home health aide and homemaker codes in Texas and New Mexico – and providers are feeling the impacts.

While some organizations are faring well despite the cuts, others have had to make difficult decisions or even close their doors because of the 43% cut for much of rural Texas and the 19% cut for New Mexico.

“Companies are closing,” Megan Casey, the senior vice president of Live Well Home Care, told Home Health Care News. “Veterans are going without care in Texas and New Mexico because people can’t get out to the rural areas. … Paying [caregivers] more than everybody else, and being able to pay mileage, overtime and bonuses is how we’ve gotten them to go out to these rural areas. And so honestly, we’re getting our butt kicked this year with trying to continue to serve [rural veterans] on the tighter margin.”

Bedford, Texas-based Live Well is a provider of personal care services to veterans operating in 18 states. The provider has retained all its office staff despite the cuts, Casey said, but has had to make adjustments at the corporate level, including some employees taking on multiple roles and not making certain investments in order to ensure funds are available to pay caregivers.

Despite the cuts, Live Well has not turned down any veterans in need of care, according to Casey, even if it means taking a financial loss. The provider’s start-of-care time has slowed, however, because finding caregivers has become more difficult.

While some provider organizations are feeling pinched due to the rate cuts, impacts vary from provider to provider.

“We have, over the last 24 months, seen the impact of the rate cuts in places like Texas, Wisconsin, New Mexico and others,” Charlie Young, CEO of Synergy HomeCare, told HHCN. “My general sense is that we have not been impacted as much as others. I think that is because we have been focused on growing our market share in those areas. So while the rate of pay is down, our market share is growing.”

Tempe, Arizona-based Synergy, which was acquired by Levine Leichtman Capital Partners (LLCP) in 2025, operates in over 626 territories across 44 states. It offers non-medical in-home services, including personal care, companion care, memory care and specialized care

Young said he has heard stories that rate cuts have negatively impacted providers’ VA businesses, but that Synergy has found ways to grow its VA revenue.

Casey said she is not concerned about Live Well’s overall sustainability, because the company has diversified into other states – but that many providers operating in only Texas or only New Mexico are struggling.

The logic behind the cuts

Casey said she was shocked when the rate announcement was made, especially because rates were released weeks ahead of the VA’s usual timeline – making it an “astronomical cut with no warning.” She also questioned the basis upon which the VA made its decisions.

“The VA stated that they spoke to providers in Texas and that everybody agreed that this rate should be implemented,” Casey said. “We’re not the biggest provider in Texas, but I know the biggest providers in Texas, and nobody had these conversations with them.”

Casey even wondered whether the recent rate cuts were made in error.

“The VA has to save money,” Casey said. “It’s a very expensive industry, obviously. And I know cost savings can help people, but this isn’t where the cost savings should have happened. One day in the hospital costs more than months of home care. So whether it’s a political move or an error, or just cost-cutting, it’s going to cost them more money in the long run.”

Shortly after the announcement of the rates, the Home Care Association of America (HCAOA) VA Advisory Council contacted leadership within VA to seek clarification of whether the changes were intentional, and leadership confirmed their accuracy.

VA cuts to personal care services did not start with these rate cuts, Casey said. The VA reduced the number of hours of care veterans can receive over the last two years – which Casey said causes more veterans to discharge into higher-acuity, higher-cost levels of care.

The future of VA rates

Providers expressed measured optimism that the VA would improve rates.

Young stated that he believed that there would be some improvement in VA rates, but that “time would tell.”

In Casey’s opinion, the VA should reimplement the 2025 rates.

“They need to retroactive it to January,” she said. “And then if they want to consider rate cuts in the future, we need to have meetings with the VA and the large providers to talk about what’s reasonable. In Texas, it’s not just one rate across the state. There are metro markets that have different rates, and then the rest of Texas. And if it’s an issue where they need to add in a few more metro markets or move something around, maybe that makes sense. But a cut to 66% of the veterans that live in Texas of that magnitude was unfair.”

Live Well is working with policymakers on a bipartisan basis to push for change. Lawmakers are listening, she said, though they are busy with other issues as well, including a strong focus on fraud.

Providers are also looking to advocacy groups to improve the slashed rates.

Synergy works actively with the HCAOA, Young said, which has expressed concerns with the deep rate cuts in Texas and New Mexico. HCAOA has solicited input from providers, asking to hear about fallout from the cuts. Live Well is also working with HCAOA, as well as the National Alliance for Care at Home and the Texas Association for Home Care & Hospice (TAHC&H).

“These veterans fought for our country,” Casey said. “I feel like I’m a lobbyist now, just trying to talk to our representatives, trying to talk to the White House and tell them that we need help.”

The post Surviving VA Slashes: Home Care Providers Report Rate Cut Impacts appeared first on Home Health Care News.