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Latest News - May 2014

May 6, 2014
Hospitals, health care union sign pact
By: Margot Roosvelt

California’s largest health care union Tuesday abandoned two ballot initiatives to rein in patient costs and executive compensation, as part of an agreement with the hospital industry to push for more state funding for indigent care.

United Healthcare Workers West, an affiliate of the Service Employees International Union, and the California Hospital Association announced they together would spend $100 million over the next two years on a “joint advocacy committee” to boost Medi-Cal funds, whether through legislation or a 2016 ballot initiative.

The truce between the industry and SEIU-UHW, which represents 90,000 of California’s 400,000 hospital workers, came as both sides said they were preparing to spend millions of dollars for and against union-backed initiatives.

The hospital association had called the union’s initiatives “dangerous, dishonest and deceptive,” characterizing them as an attempt to force hospitals to allow further unionizing of workers.

One initiative would have limited executive compensation to $450,000 a year at nonprofit hospitals. The other would have capped medical prices at 25 percent above the actual cost of providing patient care and forced hospitals to disclose their costs.

In a joint news conference with the hospital association, SEIU-UHW President David Regan refused to comment on reports his union withdrew its ballot initiatives in exchange for pledges by the bulk of the state’s nonprofit hospitals to allow the union to organize tens of thousands of additional workers.

But he noted that “it is much harder to negotiate wages” at institutions that receive inadequate funding. If Medi-Cal funding is reformed, he said. “the pressure that we experience in bargaining would be greatly relieved.”

The union and the industry refused to publicly release the terms of the pact, providing only a short, vague summary. They also declined to release a list of hospitals that have signed on, saying only they represent “a majority of beds in the state.”

C. Duane Dauner, president and chief executive of the hospital association, would not comment on reports that a number of hospitals oppose the agreement.

The collaboration was denounced publicly by a rival union, and privately by other labor groups, which have long criticized the SEIU as being too cozy with the hospital industry, and of supporting industry opposition to consumer-backed legislation.

Sal Rosselli, president of the National Union of Healthcare Workers, called the new agreement “an act of treason,” adding it will “eliminate the union’s watchdog role on behalf of patients.”

If the SEIU revealed the terms of the agreement, Rosselli said, “the details would show that in return for adding new members, SEIU agreed to become a company union. SEIU will quietly collect dues but will do little to raise questions.”

Tuesday’s pact came two years after SEIU and the hospital association announced a similar agreement, under which the association reportedly pledged to remain neutral during the union’s organizing drives. In exchange, SEIU dropped two 2012 ballot initiatives to rein in hospital billings and expand care for the poor.

But the union was unable to organize the new workers it had expected under that agreement, a situation that led to its new industry-opposed initiatives.

Dauner characterized the earlier pact as “a gentleman’s agreement” which, he said, “fell substantially short.” The new document, he added, allows for “mechanisms of enforcement” and “includes individual hospitals and health systems as signatories on a code of conduct.”

The code of conduct, Regan said, involves collaboration between the union and hospital management to eliminate “negativity” in the interactions between hospitals and their workers. Hospitals, he added, need to be “properly funded. If not, there won’t be a workforce that can look to stable employment.”

Hospital association spokeswoman Jan Emerson-Shea said the agreement to push for a boost in state funding for 7 million Medi-Cal patients over the next two years is a separate effort from another industry-backed ballot initiative, the Medi-Cal Funding and Accountability Act of 2014. That measure would extend a program that brings in $3 billion a year in federal Medicaid funds



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