Kaiser Permanente union in California nearing strike

Dive Brief:

  • A union representing 24,000 Kaiser Permanente clinicians in California has put a pause on its 24-year partnership with management, the group said Friday.
  • Leadership of the union voted last week to move forward with a membership vote that would authorize the bargaining team to call a strike.
  • The United Nurses Associations of California/Union of Health Care Professionals said in a press release Kaiser Permanente is planning “hefty cuts” to nurse wages and benefits despite the ongoing COVID-19 pandemic and high levels of burnout among nurses.

Dive Insight:

Union activity at hospitals has been ramping up since the onset of the pandemic, as front-line healthcare workers have been stretched to the brink with full ICUs, worries of infection and sick coworkers.

Now, Kaiser Permanente nurses in California are saying they’re not being appreciated for their efforts.

“How do you tell caregivers in one breath you’re our heroes, we’re invested in you, I want to protect you, but in the next say I want to take away your wages and benefits? Even say you’re a drag on our bottom line,” Charmaine Morales, executive vice president of the union, said in a press release. “For the first time in 26 years, we could be facing a strike.”

The most recent bargaining session between the health system and the union was Sept. 10. Another one hasn’t been scheduled, despite most contracts being set to expire at the end of the month, the union said.

The labor management partnership started in the 1990s as an attempt for the union and management to share information and decision-making, the union said.

But they also said company leaders have not been invested in the agreement recently.

“Kaiser Permanente has stepped back from the principles of partnership for some time now, and they have violated the letter of our partnership agreement in the lead up to our present negotiations,” union president Denise Duncan said in the press release. “Despite that, we are here and ready to collaborate again if KP leaders find their way back to the path — where patient care is the true north in our value compass, and everything else falls in line behind that principle. Patient care is Kaiser Permanente’s core business, or at least we thought so.”

The press release cites Kaiser’s profitability, as the system’s net income was nearly $3 billion in the second quarter of this year. However, that was a decrease of more than a third from the prior-year period.

It also noted multiple lawsuits alleging Kaiser tried to game the Medicare Advantage program by submitting inaccurate diagnosis codes. The Department of Justice has joined six of those lawsuits.

Kaiser Permanente did not respond to a request for comment by time of publication.

Labor Shortage extends beyond Nursing, beyond Hospitals

https://mailchi.mp/60a059924012/the-weekly-gist-september-10-2021?e=d1e747d2d8

How Could You Be Affected by the Healthcare Labor Shortage? - Right Way  Medical

The typical media coverage of the healthcare workforce crisis often focuses on the acute shortage of hospital-based nurses. For instance, the hospital forced to close a unit as nurses, burned out after 18 months of extra shifts taking care of COVID patients, leave for lower-stress, more predictable jobs in outpatient facilities or doctors’ offices.

But we’re hearing about a reverse trend in recent conversations with health system leaders. Instead of outpatient settings benefiting from an influx of nursing talent, ambulatory leaders report that nurses are now leaving for hospital or travel nursing positions that offer higher salaries and large sign-on bonuses. That’s forcing non-hospital settings to reduce operating room and endoscopy capacity.

Nor are shortages just in the nursing workforce. One system executive lamented that they had to cancel several non-emergent cardiac surgeries, not due to nurse staffing challenges; rather, they were short on surgical technicians. “Surgical techs aren’t leaving because of COVID,” the executive shared, “they’re leaving because the labor market is so strong, and they can make the same money doing something entirely different.” 

For lower-wage workers in particular, the old value proposition of working for a health system, centered around good benefits, continuing education, and a long-term career path, isn’t providing the boost it used to. Workers are willing to trade those for improved work-life balance, predictability, and the perception of a “safer” workplace.

Stabilizing the healthcare workforce will ultimately require providers to rethink job design, the allocation of talent across settings of care, and the integration of technology in workflow. And it will require re-anchoring the work in the mission of serving the community.

But in the short term, many health systems will find themselves having to pay more to retain key workers, including but not limited to hospital nurses, to maintain patient access to care. 
 

CFOs working around cost pressures, labor availability

Labor Shortage, Rising Costs, Supply-Chain Hiccups Hit Manufacturers -  Bloomberg

Dive Brief:

  • While CFOs, on the whole, remain optimistic about an economic rebound this year, they’re concerned about labor availability and accompanying cost pressures, according to a quarterly survey by Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta.
  • Over 75% of CFOs included in the survey said their companies faced challenges in finding workers. More than half of that group also said worker shortage reduced their revenue—especially for small businesses. The survey panel includes 969 CFOs across the U.S.
  • CFOs expect revenue and employment to rise notably through the rest of 2021,” Sonya Ravindranath Waddell, VP and economist at the Federal Reserve Bank of Richmond said. “[But] over a third of firms anticipated worker shortages to reduce revenue potential in the year.”

Dive Insight:

As many companies struggle to find employees and meet renewed product demand, it’s unsurprising CFOs anticipate both cost and price increases, Waddell said.

About four out of five CFO respondents reported larger-than-normal cost increases at their firms, which they expect will last for several more months. They anticipate the bulk of these cost increases will be passed along to the consumer, translating into higher-priced services.

Despite labor concerns, CFOs are reporting higher optimism than last quarter, ranking their optimism at 74.9 on a scale of zero to 100, a 1.7 jump. They rated their optimism towards the overall U.S. economy at an average of 69 out of 100, a 1.3 increase over last quarter. 

For many CFOs, revenue has dipped below 2019 levels due to worker shortage, and in some cases, material shortages, Waddell told Fortune last week. Even so, spending is on the rise, which respondents chalked up to a reopening economy.

“Our calculations indicate that, if we extrapolate from the CFO survey results, the labor shortage has reduced revenues across the country by 2.1%,” Waddell added. “In 2019, we didn’t face [the] conundrum of nine million vacancies combined with nine million unemployed workers.”

Consumer prices have jumped 5.4% over the past year, a U.S. Department of Labor report from last week found; a Fortune report found that to be the largest 12-month inflation spike since the Great Recession in 2008. 

To reduce the need for labor amid the shortage, many companies will be “surviving with just some compressed margins for a while, or turning to automation,” Waddell said.

How would “Medicare at 60” impact health system margins?

https://mailchi.mp/26f8e4c5cc02/the-weekly-gist-july-16-2021?e=d1e747d2d8

An estimate from the Partnership for America’s Healthcare Future predicts that nearly four out of five 60- to 64-year-olds would enroll in Medicare, with two-thirds transitioning from existing commercial plans, if “Medicare at 60” becomes a reality.

In the graphic above, we’ve modeled the financial impact this shift would have on a “typical” five-hospital health system, with $1B in revenue and an industry-average two percent operating margin. 

If just over half of commercially insured 60- to 64-year-olds switch to Medicare, the health system would see a $61M loss in commercial revenue.

There would be some revenue gains, especially from patients who switch from Medicaid, but the net result of the payer mix shift among the 60 to 64 population would be a loss of $30M, or three percent of annual revenue, large enough to push operating margin into the red, assuming no changes in cost structure. (Our analysis assumed a conservative estimate for commercial payment rates at 240 percent of Medicare—systems with more generous commercial payment would take a larger hit.)

Coming out of the pandemic, hospitals face rising labor costs and unpredictable volume in a more competitive marketplace. While “Medicare at 60” could provide access to lower-cost coverage for a large segment of consumers, it would force a financial reckoning for many hospitals, especially standalone hospitals and smaller systems.

Are recent labor actions getting nursing unions what they want?

While nurses in Cook County, Illinois, struck a deal in recent days, those on a three-month-plus strike against a Tenet hospital in Massachusetts plan a protest at the chain’s Dallas headquarters.

Thousands of healthcare workers have waged strikes this summer to demand better staffing levels as the pandemic brought greater attention to what happens when a nurse must take care of more patients than they can reasonably handle.

In New York, a report from the attorney general that found nursing homes with low staffing ratings had higher fatality rates during the worst COVID-19 surges last spring helped spur legislators to pass a safe staffing law long-advocated for by the New York State Nurses Association.

While unions elsewhere face a steeper climb to win the success found in New York, through strikes and other actions, they’re attempting to get new staffing rules outlined in their employment contracts.

Most nursing strikes include demands for ratios, or limits on the number of patients a nurse can be required to care for, Rebecca Givan, associate professor in the School of Management and Labor Relations at Rutgers University, said.

“And employers are very anxious about that because it threatens their bottom line, so often when a compromise is found, it’s something that approaches a ratio but maybe has a bit more flexibility,” Givan said.

Some have been successful, like the 1,000 Chicago-area nurses at Stroger Hospital, Provident Hospital and Cook County Jail who waged a one-day strike on June 24 after negotiating with the county over a new contract for nearly eight months.

They reached a tentative agreement shortly after the strike, stipulating the hiring of 300 nurses, including 125 newly added positions throughout the system within the next 18 months.

The deal also includes wage increases to help retain staff, ranging from 12% to 31% over the contract’s four-year term, according to National Nurses United.

Meanwhile, 700 nurses at Tenet’s St. Vincent Hospital in Worcester, Massachusetts, have been on strike for over 100 days over staffing levels. Nurses represented by the Massachusetts Nurses Association have been trying to get an actual nurse-to-patient ratio outlined for specific units in their next contract.

The two sides haven’t come close to reaching a deal yet, and some nurses will travel to Tenet’s headquarters in Dallas on Wednesday in an attempt to appeal to corporate executives, according to MNA.

At the same time, federal lawmakers wrote to Tenet CEO Ron Rittenmeyer seeking details on the chain’s use of federal coronavirus relief funds amid the strike and alongside record profits it turned last year.

The hospital denied lawmakers’ claims in the letter that Tenet used federal funds to enrich executives and shareholders rather than meet patient and staff needs, saying in a statement it strongly objects to the “mischaracterization of the facts and false allegations of noncompliance with any federal program.”

The strike is currently the longest among nurses nationally in a decade, according to the union.

A number of other major hospital chains have contracts covering their nurses expiring this summer, including for-profit HCA Healthcare and nonprofit Sutter Health.

Unionized nurses at 10 HCA hospitals in Florida have reached a deal on a new collective bargaining agreement, though members still need to ratify it, according to National Nurses United. The details are still unclear.

And after joining NNU just last year, 2,000 nurses at HCA’s Mission Hospital in Asheville, North Carolina, ratified their first contract Saturday, which includes wage increases and the formation of a nurse-led staffing committee.

Newly-formed unions take an average of 409 days to win a first contract, according to an analysis from Bloomberg Law. In the healthcare industry, new unions take an average of 528 days to win a first contract, the longest among all sectors examined.

Across the country at Sutter’s California hospitals, disputes haven’t been so easily resolved. Healthcare workers at eight Sutter hospitals planned protests throughout July “to expose the threat to workers and patients caused by understaffing, long patient wait times and worker safety issues at Sutter facilities,” according to Service Employees International Union United Healthcare Workers West, which represents the workers.

Similar to the ongoing Tenet hospital strike, SEIU is highlighting Sutter’s profits so far this year and the federal relief funds it received.

A “perfect storm” is brewing in the healthcare workforce

https://mailchi.mp/bade80e9bbb7/the-weekly-gist-june-18-2021?e=d1e747d2d8

Plastic Possibilities: Resin Production Meets the Perfect Storm |  plasticstoday.com

A topic that’s come up in almost every discussion we’ve had with health system executive teams and boards recently is workforce strategy. Beyond the immediate political debate about whether temporary unemployment benefits are exacerbating a shortage of workers, there’s a growing recognition that the healthcare workforce is approaching something that looks like a “perfect storm”.

The workforce is mentally and physically exhausted from the pandemic, which has taken a toll both professionally and personally. Many workers are rethinking their work-life balance equations in the wake of a difficult year, during which working conditions and family responsibilities shifted dramatically. That, along with broader economic inflation, is driving demands for higher wages and a more robust set of benefits.

Meanwhile, many health systems are shifting into cost-cutting mode, due to COVID-related shifts in demand patterns and continued downward pressure on reimbursement rates, forcing a renewed focus on workforce productivity.

These combined forces threaten to create a negative spiral, which could lead to even worse shortages and deteriorating workplace engagement. It’s striking how quickly the “hero” narrative has shifted to a “crisis” narrative, and we agree completely with one health system board member who told us recently that workforce strategy is now the number one issue on his agenda.

No easy answers here, but we’ll continue to report on innovative approaches to addressing these difficult challenges.

Sutter Health to lay off 400 workers

Sutter Health fined again over not notifying nurses about COVID-19 exposure

As part of a financial restructuring plan, Sacramento, Calif.-based Sutter Health will issue another round of layoffs this year, according to the Sacramento Business Journal.  

The health system said it plans to lay off 400 more employees. These newly announced layoffs are in addition to 277 information technology jobs that were cut April 2. 

Sutter said most of the new layoffs affect employees in administrative positions in benefits, human resources, data services and accounting. The layoff notice said many of these employees were working remotely or in the field. 

Sutter told the Business Journal that it’s working to evaluate every aspect of its business model.

“Moving forward, we will continue to work to minimize staff reductions and their impact on our dedicated employees as we look for ways to eliminate variation, streamline resources and more efficiently manage our indirect costs,” Sutter told the Business Journal.

Sutter ended 2020 with a $321 million operating loss, including $800M in funding from the Coronavirus, Aid, Relief and Economic Security Act. Without the funding, Sutter’s operating loss would have been $1.1 billion. As a result, Sutter initiated a sweeping review of its finances in March 2021. 

Sutter Health also gave voluntary severance packages to 800 workers in 2020.

Tenet California hospital workers set May 6 union rally after shareholders meeting

South California healthcare workers plan payment, safety protest during Tenet  Healthcare investor meeting | FierceHealthcare

Workers at three Tenet Healthcare hospitals in Southern California will hold a rally May 6 to highlight their concerns about staffing, wages and benefits during the COVID-19 pandemic, according to the union that represents them. 

The rally comes as the National Union of Healthcare Workers is in negotiations with Dallas-based Tenet for more than 600 direct Tenet employees at Fountain Valley Regional, including respiratory therapists, nursing assistants and X-ray technicians. The union is also in negotiations with the Compass Group, a food and support services provider, for about 225 housekeepers and food service workers at Tenet California hospitals in Fountain Valley, Los Alamitos and Lakewood, who are subcontracted by Tenet and employees of Compass.

Union spokesperson Matt Artz told Becker’s workers contend Tenet has remained profitable during the pandemic, but it did not implement appropriate safety measures. He said Tenet also rejected proposals to better staff certain units, and it has rejected the union’s proposal to stop subcontracting out the housekeepers and food service workers who have struggled to afford healthcare.

The union said Tenet, a major for-profit hospital operator, has the financial means to address these issues. The company reported a $97 million profit in the first quarter of 2021. Tenet stock also recently hit a new 52-week high, according to an April 29 report from Zacks Equity Research. 

“These profits are not helping workers or patients,” Christina Rodriguez, a respiratory therapist at Fountain Valley (Calif.) Regional Hospital, said in a May 5 news release. “They’re being made at the expense of patient care and the people who have put their health on the line to help patients during this pandemic. At the height of the surge, I would go home crying that we didn’t have enough staff to help patients struggling to survive.”

Tenet contends the issue is not about Tenet but rather about negotiations between Compass and the union. Tenet said it is focused on staff and patients. 

“This matter is not about us. It’s about a negotiation strictly between the NUHW and the Compass Group, which is a vendor that provides a range of food, laundry and other support services to hospitals,” Tenet told Becker’s. “At all times, our main concern is the safety of our staff, the integrity of our facilities and the best possible outcomes for our patients, and we remain hopeful that the NUHW and Compass will reach a positive outcome at the conclusion of their respective negotiations.”

But the union said Tenet can decide whether to bring the subcontracted housekeepers and food service workers in-house, which would benefit them in terms of wages and health benefits. 

Meanwhile, Compass said it will continue to negotiate in good faith, with union members.

“Our hardworking team members are at the heart of what we do, and their determination to provide best-in-class care and service is inspiring,” a Compass spokesperson told Becker’s. “We take pride in paying competitive wages and providing affordable benefits and continue to uphold our agreement with the NUHW. We have a long history of listening to our employees, working productively with unions, and will continue to meet and negotiate — always in good faith.” 

Respiratory therapists, housekeepers, nursing assistants, medical technicians, dietary workers and others represented by the union said they plan to rally from 11 a.m. to noon May 6 outside Fountain Valley Regional. 

The rally, scheduled after Tenet’s shareholders meeting, includes workers from Los Alamitos (Calif.) Medical Center and Lakewood (Calif.) Regional Medical Center. Union workers whose jobs are subcontracted to Compass will speak during the rally, the union said.