I ran into the same problem a long time ago and now I add the following to the beginning of my profile:
# Setup user environment when running session under alternate credentials and
# logged in as a normal user.
if ((Get-PSProvider FileSystem).Home -eq "")
{
Set-Variable HOME $env:USERPROFILE -Force
$env:HOMEDRIVE = Split-Path $HOME -Qualifier
$env:HOMEPATH = Split-Path $HOME -NoQualifier
(Get-PSProvider FileSystem).Home = $HOME
Set-Location $HOME
}