May 5, 2014:
After years of accusations, the nation’s largest health-care union and California’s hospital industry announced Tuesday they will jointly raise and spend $100 million to work on improving Medi-Cal reimbursement rates across the Golden State.
Service Employees International Union-United Healthcare Workers signed the agreement with the California Hospital Association. In return, the SEIU-UWH dropped two ballot measures the hospital association opposed: one to cap CEO pay and the other to cap what hospitals can charge to 25 percent above the actual cost of services.
According to the SEIU-UHW, hospitals on average charge 320 percent above the cost of care.
Both sides called the agreement the largest such collaboration between a major industry and union in the history of the state of California.
“This is a unique agreement that is driven by two organizations committed to improving healthcare,” said California Hospital Association President C. Duane Dauner.
Dave Regan, President of SEIU-UHW, said the move would help reinvigorate the union, which has seen a steady decline in membership. The agreement establishes a code of conduct between the two groups, to eliminate negativity and misleading information, Regan said.
“We believe if we’re going to be successful as a union moving forward, we have to take the conflict out,” Regan said. “We believe most caregivers want more than anything to give great care.”
Both groups declined to say how much each would contribute to the $100 million fund. The money would be spent on increasing the state’s Medi-Cal, by “identifying new resources and financing approaches at the federal and state levels, including educational activities, legislative and regulatory efforts, a ballot initiative, or other strategies”
California ranked near the bottom when it came to reimbursing hospitals for care, Dauner and Regan emphasized.
“We believe the hospital industry through the leadership of the CHA has come a long way from where the conversation started three years ago,” Regan said. “We have an agreement that will raise the quality of care, lower costs and serve the greater good.”
But some groups mocked the agreement, saying that a similar one had been drawn up two years ago, when the SEIU also halted plans to submit signatures to qualify for the November 2012 ballot. The measures involved increasing charity care and hospital pricing initiatives.
The National Union of Healthcare Workers opposed the SEIU, comparing the group’s pact to an act of treason.
“This agreement will undermine the rights of workers and will eliminate the union’s watchdog role on behalf of patients,” said Sal Rosselli, president of the NUHW, in a statement.
“The two parties won’t even release the details of this agreement. If they had released what SEIU terms ‘a gentlemen’s agreement,’ the details would show that in return for adding new members to their rolls, SEIU agreed to become a company union,” Rosselli said. “Moving forward, SEIU will quietly collect dues, but will do little to raise questions.”
Of the 430 hospitals in California, 90 percent are members of the California Hospital Association. A spokeswoman said most support the pact. Providence Health & Services, Southern California, which oversees hospitals in Mission Hills, Burbank and Torrance, praised the agreement.
“Providence Health & Services, Southern California, is heartened by the agreement announced today by the California Hospital Association and the Service Employees International Union West,” according to the statement. “The agreement recognizes the complexities involved in the common goal of reducing healthcare costs and allows us to focus on our primary concern: quality and compassionate care for our patients. Providence remains committed to our employees’ right to choose whether they want union representation.”