UNION RESCHEDULES KAISER PERMANENTE STRIKE POSTPONED AFTER CEO’S DEATH

https://www.healthleadersmedia.com/strategy/union-reschedules-kaiser-permanente-strike-postponed-after-ceos-death?spMailingID=16676008&spUserID=MTg2ODM1MDE3NTU1S0&spJobID=1780330838&spReportId=MTc4MDMzMDgzOAS2

The health system’s senior vice president of national labor relations said the conflict is resolvable, ‘and there is no reason to strike.’

A five-day strike that was postponed last month after the sudden death of Kaiser Permanente Chairman and CEO Bernard J. Tyson is back on the calendar.

Thousands of psychologists, therapists, psychiatric nurses, and other healthcare professionals plan to strike December 16–20 at more than 100 Kaiser Permanente facilities across California, the National Union of Healthcare Workers (NUHW) said Wednesday.

“Mental health has been underserved and overlooked by the Kaiser system for too long,” said Ken Rogers, PsyD, MEd, a Kaiser Permanente clinical psychologist who serves as a vice president on the NUHW executive board, in a statement released by the union.

“We’re ready to work with Kaiser to create a new model for mental health care that doesn’t force patients to wait two months for appointments and leave clinicians with unsustainable caseloads,” Rogers said. “But Kaiser needs to show that it’s committed to fixing its system and treating patients and caregivers fairly.”

The union accuses Kaiser Permanente of refusing to negotiate unless mental health clinicians agree to “significantly poorer retirement and health benefits” than those received by its more than 120,000 other California employees.

Dennis Dabney, senior vice president of national labor relations and the Office of Labor Management Partnership at the Kaiser Foundation Health Plan and Hospitals, said the parties have been working together with an external mediator in pursuit of a collective bargaining agreement. The union rejected a compromise solution proposed last week by the mediator, Dabney said.

“The only issues actively in negotiation in Northern California are related to wage increases and the amount of administrative time that therapists have beyond patient time,” Dabney said. “We believe these issues are resolvable and there is no reason to strike.”

The mediator’s recommendation includes about 3% in annual wage increases for therapists in Northern California for four years, plus a $2,600 retroactive bonus, Dabney said

“In Southern California, the primary contract concern relates to wage increases and retirement benefits,” Dabney said.

The mediator’s recommendation includes about 3% in annual wage increases for therapists in Southern California for four years, plus a $2,600 retroactive bonus, even though the organization’s therapists in Southern California “are paid nearly 35% above market,” Dabney said.

“Rather than calling for a strike, NUHW’s leadership should continue to engage with the mediator and Kaiser Permanente to resolve these issues,” Dabney said.

 

 

 

University of Chicago Medical Center closes level 1 trauma center ahead of strike

https://www.beckershospitalreview.com/human-resources/university-of-chicago-medical-center-closes-level-1-trauma-center-ahead-of-strike.html

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University of Chicago Medical Center has closed its level 1 trauma center for adult and pediatric patients as it prepares for about 2,200 nurses to go on strike next week, medical center leaders announced.

Medical center leaders said UCMC closed its pediatric level 1 trauma program Nov. 18 and its adult trauma program Nov. 20. Its adult and pediatric emergency rooms continue to take walk-in patients.

Nurses are scheduled to strike Nov. 26, two days before Thanksgiving. The nurses also walked off the job Sept. 20 in a strike organized by National Nurses Organizing Committee/National Nurses United. They were allowed to return to work Sept. 25, after the medical center said it fulfilled its contract with temporary nurses to replace the striking ones for five days.

In preparation for the strike, UCMC announced earlier this week that it is moving about 50 babies and 20 children in its neonatal and pediatric intensive care units to other facilities.

UCMC President Sharon O’Keefe is also recruiting about 900 replacement nurses.

However, “it’s exceptionally difficult to hire people who are willing to leave their families during Thanksgiving,” she said in a news release. “At the same time, other hospitals in the city are already at or near capacity, which means they will not be able accept transfers of current inpatients if that need arises when nurses walk out. The combination of the two led us to take the step of temporarily closing our trauma program ahead of the strike.”

UCMC said the hospital was required to offer replacement nurses five days of work “to best recruit qualified and experienced replacement nurses.” Therefore, the nurses on strike will not be able to return to work until 7 a.m. Dec. 1.

Negotiations between UCMC and National Nurses Organizing Committee/National Nurses United began earlier this year. Medical center leaders say incentive pay — and whether the hospital should end the pay for newly hired nurses — is a sticking point in negotiations, according to the Chicago Tribune. The union has continued to express concerns about staffing levels.

The nurses said they plan to strike unless an agreement is reached.

 

 

 

 

Bruising labor battles put Kaiser Permanente’s reputation on the line

Bruising labor battles put Kaiser Permanente’s reputation on the line

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The ongoing labor battles have undermined the health giant’s once-golden reputation as a model of cost-effective care that caters to satisfied patients — which it calls “members” — and is exposing it to new scrutiny from politicians and health policy analysts.

Kaiser Permanente, which just narrowly averted one massive strike, is facing another one Monday.

The ongoing labor battles have undermined the health giant’s once-golden reputation as a model of cost-effective care that caters to satisfied patients — which it calls “members” — and is exposing it to new scrutiny from politicians and health policy analysts.

As the labor disputes have played out loudly, ricocheting off the bargaining table and into the public realm, some critics believe that the nonprofit health system is becoming more like its for-profit counterparts and is no longer living up to its foundational ideals.

Compensation for CEO Bernard Tyson topped $16 million in 2017, making him the highest-paid nonprofit health system executive in the nation. The organization also is building a $900 million flagship headquarters in Oakland. And it bid up to $295 million to become the Golden State Warriors’ official health care provider, the San Francisco Chronicle reported. The deal gave the health system naming rights for the shopping and restaurant complex surrounding the team’s new arena in San Francisco, which it has dubbed “Thrive City.”

The organization reported $2.5 billion in net income in 2018 and its health plan sits on about $37.6 billion in reserves.

Against that backdrop of wealth, more than 80,000 employees were poised to strike last month over salaries, retirement benefits and concerns over outsourcing and subcontracting. Nearly 4,000 members of its mental health staff in California are threatening to walk out Monday over the long wait times their patients face for appointments.

“Kaiser’s primary mission, based on their nonprofit status, is to serve a charitable mission,” said Ge Bai, associate professor of accounting and health policy at Johns Hopkins University. “The question is, do they need such an excessive, fancy flagship space? Or should they save money to help the poor and increase employee salaries?”

Lawmakers in California, Kaiser Permanente’s home state, recently targeted it with a new financial transparency law aimed at determining why its premiums continue to increase.

There’s a growing suspicion “that these nonprofit hospitals are not here purely for charitable missions, but instead are working to expand market share,” Bai said.

The scrutiny marks a disorienting role-reversal for Kaiser, an integrated system that acts as both health insurer and medical provider, serving 12.3 million patients and operating 39 hospitals across eight states and the District of Columbia. The bulk of its presence is in California. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanente.)

Many health systems have tried to imitate its model for delivering affordable health care, which features teams of salaried doctors and health professionals who work together closely, and charges few if any extraneous patient fees. It emphasizes caring and community with slogans like “Health isn’t an industry. It’s a cause,” and “We’re all in this together. And together, we thrive.”

Praised by President Barack Obama for its efficiency and high-quality care, the health maintenance organization has tried to set itself apart from its profit-hungry, fee-for-service counterparts.

Now, its current practices — financial and medical — are getting a more critical look.

As a nonprofit, Kaiser doesn’t have to pay local property and sales taxes, state income taxes and federal corporate taxes, in exchange for providing “charity care and community benefits” — although the federal government doesn’t specify how much.

As a percentage of its total spending, Kaiser Permanente’s charity care spending has decreased from 1.29% in 2012 to 0.8% in 2017. Other hospitals in California have exhibited a similar decrease, saying there are fewer uninsured patients who need help since the Affordable Care Act expanded insurance coverage.

CEO Tyson told California Healthline that he limits operating income to about 2% of revenue, which pays for things like capital improvements, community benefit programs and “the running of the company.”

“The idea we’re trying to maximize profit is a false premise,” he said.

The organization is different from many other health systems because of its integrated model, so comparisons are not perfect, but its operating margins were smaller and more stable than other large nonprofit hospital groups in California. AdventHealth’s operating margin was 7.15% in 2018, while Dignity Health had losses in 2016 and 2017.

Tyson said that executive compensation is a “hotspot” for any company in a labor dispute. “In no way would I try to justify it or argue against it,” he said of his salary. In addition to his generous compensation, the health plan paid 35 other executives more than $1 million each in 2017, according to its tax filings.

Even its board members are well-compensated. In 2017, 13 directors each received between $129,000 and $273,000 for what its tax filings say is five to 10 hours of work a week.

And that $37.6 billion in reserves? It’s about 17 times more than the health plan is required by the state to maintain, according to the California Department of Managed Health Care.

Kaiser Permanente said it doesn’t consider its reserves excessive because state regulations don’t account for its integrated model. These reserves represent the value of its hospitals and hundreds of medical offices in California, plus the information technology they rely on, it said.

Kaiser Permanente said its new headquarters will save at least $60 million a year in operating costs because it will bring all of its Oakland staffers under one roof. It justified the partnership with the Warriors by noting it spans 20 years and includes a community gathering space that will provide health services for both members and the public.

Kaiser has a right to defend its spending, but “it’s hard to imagine a nearly $300 million sponsorship being justifiable,” said Michael Rozier, an assistant professor at St. Louis University who studies nonprofit hospitals.

The Service Employees International Union-United Healthcare Workers West was about to strike in October before reaching an agreement with Kaiser Permanente.

Democratic presidential candidates Kamala HarrisBernie SandersElizabeth Warren and Pete Buttigieg, as well as 132 elected California officials, supported the cause.

California legislators this year adopted a bill sponsored by SEIU California that will require the health system to report its financial data to the state by facility, as opposed to reporting aggregated data from its Northern and Southern California regions, as it currently does. This data must include expenses, revenues by payer and the reasons for premium increases.

Other hospitals already report financial data this way, but the California legislature granted Kaiser Permanente an exemption when reporting began in the 1970s because it is an integrated system. This created a financial “black hole” said state Sen. Richard Pan (D-Sacramento), the bill’s author.

“They’re the biggest game in town,” said Anthony Wright, executive director of the consumer group Health Access California. “With great power comes great responsibility and a need for transparency.”

Patient care, too, is under scrutiny.

California’s Department of Managed Health Care fined the organization $4 million over mental health wait times in 2013, and in 2017 hammered out an agreement with it to hire an outside consultant to help improve access to care. The department said Kaiser Permanente has so far met all the requirements of the settlement.

But according to the National Union of Healthcare Workers, which is planning Monday’s walkout, wait times have just gotten worse.

Tyson said mental health care delivery is a national issue — “not unique to Kaiser Permanente.” He said the system is actively hiring more staff, contracting with outside providers and looking into using technology to broaden access to treatment.

At a mid-October union rally in Oakland, therapists said the health system’s billions in profits should allow it to hire more than one mental health clinician for every 3,000 members, which the union says is the current ratio.

Ann Rivello, 50, who has worked periodically at Kaiser Permanente Redwood City Medical Center since 2000, said therapists are so busy they struggle to take bathroom breaks and patients wait about two months between appointments for individual therapy.

“Just take $100 million that they’re putting into the new ‘Thrive City’ over there with the Warriors,” she said. “Why can’t they just give it to mental health?”

 

 

 

Kaiser strike called off as company, unions reach tentative agreement

https://www.healthcaredive.com/news/kaiser-strike-called-off-as-company-unions-reach-tentative-agreement/563523/

UPDATE: Sept. 25, 2019: Following two days of discussion, Kaiser Permanente has come to an agreement with the Coalition of Kaiser Permanente Unions, which has called off the strike. Under the terms of the four-year tentative agreement, some 85,000 unionized Kaiser employees will receive guaranteed annual wage increases through 2023, additional education, training and advancement opportunities, a defined benefit pension plan, higher travel reimbursement and incentives for using Kaiser’s mail-order prescription service.

The coalition of unions and Kaiser reached a consensus Tuesday following roughly five months of bargaining. The agreement still needs to be ratified by coalition union members. Voting is expected to be completed by the end of October and, if approved, the contract will have an effective date of Oct. 1.

Arlene Peasnall, Kaiser’s interim chief human resources officer, said the company and its workforce “may disagree at times, but we have always been able to work through our challenges to align on common goals,” she said.

Dive Brief:

  • An overwhelming majority of Kaiser Permanente workers voted to authorize a strike in October over the not-for-profit integrated health system’s labor practices. It will be one of the largest strikes in the last two decades if the system and the union coalition fail to come to an understanding.
  • The final unions voted over the weekend, bringing the total of U.S. Kaiser employees in support of the strike to almost 51,000 (97% of all Kaiser coalition union members). Three percent, or 1,348 workers, voted ‘no’ on the strike.
  • The Coalition of Kaiser Permanente Unions are meeting with Kaiser leadership Monday and Tuesday for a two-day bargaining session. If no agreement is reached, the strike is scheduled to begin Oct. 14 and run for seven days.

Dive Insight:

The final votes on a Kaiser Permanente strike trickled in over the weekend. The last three unions located in Washington, D.C. and Southern California finished voting on Friday, though a Coalition representative declined to break down votes by individual union.

Union leaders counted 50,884 ‘yes’ votes in support of the strike and 1,348 ‘no’ votes, accounting for 97% and 3% of workers represented by unions under the coalition, respectively.

Kaiser, which has previously blamed worker support for the strike on “misleading” ballot questions, said it would continue to work with the union coalition toward a mutually beneficial outcome. For example, the not-for-profit giant’s most recent contract proposal for its Colorado workers offers guaranteed wage increases and no changes to pension benefits.

“We are offering a proposal that’s fair, equitable, and aligned with our other union agreements,” Arlene Peasnall, Senior Vice President for Human Resources at Kaiser told Healthcare Dive. “We hope the Coalition will not call a strike on October 14. However, we are preparing to deal with all scenarios.”

Support for the strike has continued to mount over the past few months, with labor interests across the country skewering the Oakland, California-based nonprofit provider for soaring profits and what they see as unfair labor practices.

Along with sitting on more than $37 billion in reserves, Kaiser took in more than $5.2 billion in income in the first half of the year alone, heightening scrutiny of the system.

California Governor Gavin Newsom, a Democrat, signed a bill into law earlier this month mandating Kaiser be more transparent within its financial disclosures, including breaking down expenses and revenue on a per-facility basis, revenue by type of payer and rate increases by type of medical service provided starting in 2020.

It’s been almost a full year since the Kaiser workforce’s national contract expired. Kaiser was charged by the National Labor Relations Board for failing to bargain in good faith in December, and union employees have been working without a national contract ever since.

However, it appears matters have come to a head, with the strike garnering support from California community leaders, religious figures and influential politicians, including House Speaker Nancy Pelosi, presidential hopeful Senator Kamala Harris, D-Calif., Sens. Ron Wyden, D-Ore. and Jeff Merkley, D-Ore., and Rep. Maxine Waters, D-Calif.

 

 

 

Healthcare jobs grow at rapid clip, but wages lag amid consolidation boom

https://www.healthcaredive.com/trendline/labor/28/#story-4

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Healthcare employment is growing at a record pace, but wages remain stagnant, which some experts say likely results in part from the trend of consolidating health systems.

The latest Bureau of Labor Statistics numbers show the industry gained 49,000 jobs in March and 398,000 over the past 12 months. Analysts at Jefferies say the month-to-month growth is the second largest increase on record for the sector. Healthcare job growth has surpassed non-healthcare job growth and nudging the share of total jobs to an all time high, according to consulting firm Altarum.

Hospital employment grew by 14,000 jobs in March, adding up to a total of 120,000 for the combined first quarter of 2019. BLS tallied ambulatory jobs at 27,000 and home health and skilled nursing jobs at 9,000.

At the same time, real average weekly earnings for production and non-supervisory employees across sectors grew 0.1% over the month according to BLS. That growth in earnings is due to an increase in average weekly hours.

For nurses and pharmacists working in hospitals in heavily concentrated markets, annual wage growth has been lagging behind national rates by as much as 1.7 times. That’s according to researchers Elana Prager and Matt Schmitt, of Kellogg and UCLA, respectively, whose working paper compares wage growth rates in markets where mergers have occurred.

The paper drew the ire of the American Hospital Association.

“Among the many serious concerns about the study are its lack of rigor in the definitions and assumptions it used, and absence of data on total compensation and the recognition of other obvious factors that could affect wage growth,” an AHA spokesperson said in a statement criticizing media coverage of the research.

Academics researching the impacts of consolidation have asked the Federal Trade Commission to look at the impact horizontal mergers have on labor and consumers before they become difficult to challenge. FTC green-lit hundreds of horizontal hospital mergers over the past decade, maxing out at 115 in 2017, according to the National Institute for Health Care Management. In 2009, there were 50 such deals.

A Penn Law paper on mergers and labor markets published last year found employer consolidation has had a direct impact on wages and productivity in concentrated labor markets in the past. Wages, the authors write, tend to dilute when competition is scarce and labor concentration is “very high, as high or higher overall than product market concentration.”

Jason Plagman, a healthcare analyst at Jefferies, agreed, telling Healthcare Dive it becomes an “oligopsony situation where there are only a handful of buyers of a product” — in this case, labor — “you tend to see [employers] exert more control.”

As AHA noted, hospital and health systems tend to offer non-wage benefits, “such as employer-sponsored insurance, time off and education benefits” rather than increase wages. That’s an important caveat, said Dennis Shea, a health policy professor at Penn State.

 

Labor push

The debate comes as nurses unions have been pushing hard for additional staff and higher wages for hospital workers in consolidated states like California, New York, Massachusetts and Pennsylvania. Hospital consolidation has raised prices as much as 20% to 40% when they occur in the same market, according to National Institute for Health Care Management, with some prices reaching as much as 55%.

Unions argue hospitals can afford to pay extra to hire more nurses. Jefferies analyst Plagman said it’s not that easy. About 50% of hospital revenue goes to salary, wages and benefits, he said, and half of that chunk of revenue goes to nurses. “If they give a 3% raise to all nurses, that’s a big impact on their overall expense line,” Plagman said.

The lack of competition bars labor from seeking work elsewhere. A nurse in a concentrated labor market can’t quit their job to work for the hospital down the street, because it’s probably owned by the same health system, Shea said.

Shea and Plagman agreed that movement of labor away from concentrated markets is one way to break the wage slump. But lack of mobility was one of the consequences of concentration found in a National Bureau of Economic Research published in February 2018. The paper suggests a negative relationship between consolidated markets and wages that becomes more pronounced with higher levels of concentration and only increases over time.

Pay raises have historically been pushed by labor unions, and though some hospitals have already raised wages, few have been inclined to raise staffing levels as well.

“Strikes are picking up,” Shea said. “That’s always an indicator that wage and salary growth will pick up a little bit.”

While labor disruption has been on the rise over the past year, Plagman ​said he expects employment and wage growth to continue at the current pace. At some point, he said the market will have to resolve itself.

“What we’re seeing is hospitals and healthcare providers are hiring, but they’ve been very disciplined over the past few years giving raises to nurses and therapists,” Plagman said.

In testimony to the FTC in October, economist Alan Kreuger alleged employers in concentrated markets “collude to hold wages to a fixed, below-market rate,” even when the economy is booming. Union membership has plummeted 25% since 1980, and without a counterweight to balance the power of a monopsony, he argued, employers are free to set wages at will — even if they lag behind inflation rates.

Pressures to contain costs and move from volume to value is forcing health system executives to be extra delicate with their labor expenses. When nurses strike, hospitals have temps at the ready. That’s a boon for staffing agencies like AMN Healthcare Services and Cross Country Healthcare.

Cost control in healthcare is a bit like “pushing on a balloon,” Shea said.

Slow growth or declines in one sector means business is booming for another. In this case, ambulatory added 27,000 jobs month-to-month in March, up from 22,000 in February, and Jefferies analysts are looking favorably at temporary staffing agencies.

While “all indicators” say healthcare wages should be pushed up, Shea said, he wouldn’t be surprised if the growth rate continued to limp along for a little while longer.

 

 

 

 

 

Hospitals hit bump, but healthcare jobs showed steady growth in July

https://www.healthcaredive.com/trendline/labor/28/#story-1

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Dive Brief:

  • A total of 30,000 healthcare jobs were added to the U.S. labor rolls in July, representing 18% of all new jobs added during the month, according to the Department of Labor.
  • Virtually all of the healthcare job growth occurred in ambulatory care — that segment accounted for 29,000 new jobs alone.
  • The weak spot was in hospital job growth, which was down by 2,000 jobs from the month before.

Dive Insight:

Hospitals are often the biggest employers in many towns and medium-sized cities, but their job creation has been uneven at best in recent months. According to an analyst note from Jefferies, employment by hospitals dropped by 2,000 on a seasonally adjusted basis, although that grew to a net 1,000 new jobs on an unadjusted basis.

By comparison, hospitals added a seasonally adjusted 9,000 new jobs in June, 25,000 on an unadjusted basis. However, much of that boost was created by the minting of new residents who just graduated from medical schools.

Hospital employment is still growing at a 1.8% annual clip (compared to 1.4% as of July 2018), although that’s down from the 2.1% rate reported in April.

“Overall, healthcare employment growth continues to demonstrate strong momentum, but hospital jobs growth appears to be moderating,” the analysts said. Inpatient providers account for more than 5.2 million jobs nationwide.

However, Jefferies’ analysts believe that healthcare will continue to be a big job engine for the foreseeable future.

“We believe the supply of clinical labor continues to struggle to keep pace with solid demand growth, resulting in tight clinician labor markets and strong demand for healthcare temp staffing services,” they said.

Although healthcare job growth has been extremely robust, wages have been stagnant in recent years, a phenomenon attributed in part to continued consolidation among industry players.

The ambulatory care segment has been growing rapidly in recent years. Its addition of 29,000 new jobs was up from 17,000 in June, and significantly outpaced the year-to-date average monthly growth of 22,000.

Home healthcare services added 11,000 new jobs last month alone — the highest rate since 2017. The segment’s annual growth rate is currently 5.3%, up from 3.2% in July 2018.

The nursing home segment added another 1,000 jobs.

 

 

‘We have not lost our way’: Kaiser CEO’s memo to staff after Labor Day protests

https://www.beckershospitalreview.com/hospital-management-administration/we-have-not-lost-our-way-kaiser-ceo-s-memo-to-staff-after-labor-day-protests.html

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Bernard J. Tyson, chairman and CEO of Oakland, Calif.-based Kaiser Permanente, sent a memo to his staff Sept. 3 to address Labor Day protests employees held in five cities amid threats of a potential nationwide strike.  

In the memo, obtained by Becker’s Hospital Review, Mr. Tyson claims leaders of the Service Employees International Union-United Healthcare Workers used the protests to “deliver a false narrative” and “misconstrue what is really happening with [contract] negotiations.”

SEIU-UHW is one of the 16 international unions representing Kaiser employees, and one of three unions that form the Coalition of Kaiser Permanente Unions. The coalition’s bargaining team and Kaiser have been negotiating a new contract for workers, as the current contract is set to expire this month. The coalition alleges Kaiser is using unfair labor practices and prioritizing profits over patients. Last month, union members voted to authorize a nationwide strike that would affect more than 80,000 Kaiser employees nationwide.

“Kaiser Permanente has put multiple options on the table for Coalition/SEIU-UHW leadership to consider, and we remain open to these options within the established parameters consistent with all our 60 unions,” Mr. Tyson wrote in the memo. The 16 international unions that represent Kaiser employees are divided into 60 local unions, each of which has its own contract.

Mr. Tyson said Kaiser has always been committed to working collaboratively and forging positive relationships with the unions representing its 165,000 employees.

“Going forward, we will respond more definitively to allegations against our organization’s stellar brand and reputation. We have not lost our way,” Mr. Tyson wrote. “We have an incredible workforce and will always treat them with dignity and respect, along with offering market competitive wages and benefits fit for the times.”