Desperate for new members and the dues they generate, unions are poised to exploit recent changes in the nation’s labor laws engineered by President Obama’s National Labor Relations Board to make organizing easier. This will push the pace of unionization in the health care industry, increase costs, and reduce the quality of patient care.
The U.S. health care industry is an attractive target for organized labor because it is stocked with well-paying jobs that cannot be outsourced. After 1974, union activity in the industry increased markedly when Congress amended the law and included non-profit hospitals under the provisions of the National Labor Relations Act. Although the percentage of the private workforce that is unionized is at an historic low— just under 7 percent – the percentage of hospital workers who are union members has increased by 30 percent over the last decade. Over 24 percent of health care workers are unionized, including 20 percent of nurses.
Wages and benefits account for roughly three-fifths of a hospital’s expenditures. One study performed by Vanderbilt Professor Frank Sloan a few years after the 1974 amendments were passed found that unionization drove up the wage costs of 367 hospitals by 8.8 percent without improving productivity. Other studies suggest that wage costs increased by as much as 12 percent. A 2009 study by the Heritage Foundation calculated that if the U.S. health care industry becomes as unionized as in Canada, it would “raise the cost of hospital coverage by approximately $27 billion in 2013 and by $192 billion in the 2013-2018 period.” The study concluded that “widespread unionization of the health care sector would make a government-run ‘public plan’ much more expensive than currently advertised.”
But perhaps the greatest cost of unionization is the hidden, hard-to-calculate non-wage costs it imposes, including:
- The costs to negotiate and apply one or more collective bargaining agreements;
- Increased staff costs due to restrictive union work rules, which, for example, prohibit supervisors and managers from performing unit work;
- Difficulty recruiting and retaining high-performers who do not want to be locked in to a seniority system;
- The productivity losses caused by retaining under-performers who are protected by union rules and laws misapplied by union partisans at the NLRB;
- The costs incurred from the inability to implement operational changes and improvements;
- The damage to a hospital’s reputation by a union seeking a negotiating advantage;
- The damage to workplace morale caused by the adversarial relationship that unions often foster in the workplace.
Recent changes made by the NLRB will accelerate the trend toward unionization in health care, will result in still higher costs and will reduce the quality of patient care.
Last year, the NLRB ditched decades of Board law developed by Republican and Democrat-controlled Boards alike; in a case known as Specialty Healthcare, the Board authorized unions to organize tiny sub-sets of employees (micro-unions). Because smaller units are easier to organize than larger ones, micro-unions will give Big Labor easy access to an employer. The multiplicity of units it permits will also fragment the workforce and create an inflationary whipsaw process in bargaining as multiple small groups of employees compete for larger compensation packages.
Although the micro-union decision does not apply to the acute health care industry – in response to Congressional concern, the NLRB promulgated a health care rule in 1989 that limits the number of units in an acute care facility to eight. The inflationary pressure created by micro-unions in the non-acute health care industry will not easily be contained. The increased wages and benefits they will generate in the non-acute wing of the health care industry will spill over into acute care as wage and benefit gains in the one are sought in the other.
But perhaps the most pernicious impact of micro-unions is the increased work stoppages they will cause and the reduction in the quality of patient care that will result.
Work stoppages are already prevalent in the health care industry. The Federal Mediation and Conciliation Service (FMCS) reports the strikes that are reported to it. According to the FMCS, during the 10 years ending in December 2004, there were 831 work stoppages in the health care industry. In the first six months of 2012 alone, 25 work stoppages have been reported. One strike that began in February 2012 idled 218 American Red Cross blood bank workers in northern Ohio for over three months. In 2011, thousands of California nurses walked off the job just before Christmas. In 2010, approximately 1,500 nurses from Temple University Hospital in Philadelphia struck for nearly a month.
These numbers will escalate. There is a well-recognized correlation between an undue proliferation of bargaining units in the workplace and work stoppages. As micro-unions proliferate in the non-acute health care industry, the multiplicity of different small unions represented by different unions with different goals will exacerbate workplace tensions and increase the number of work stoppages. These labor disputes will spawn similar disputes in acute health care institutions.
To protect the continuity of patient care, the 1974 amendments required that health care institutions be given 10 days prior written notice of a work stoppage. Prior notice gives the institution an opportunity to hire replacement workers in order to prevent interruptions in the continuity of patient care and harm to the patient. It is virtually impossible to replace thousands of nurses and familiarize the replacements with the hospital’s procedures and the complex medical needs of each patient within 10 days. Mistakes are unavoidable. A 2011 labor dispute of nearly 23,000 nurses in California is believed to have resulted in the death of a patient. The California Nurses Association claimed that the hospital hired an unqualified replacement nurse who administered a non-prescribed drug to a patient that caused her death.
A study of nurses’ strikes in New York State by two professors – one at MIT, the other at Carnegie Mellon University – found that “nurses’ strikes increase in-hospital mortality by 19.4 percent and 30-day readmission by 6.5 percent for patients admitted during a strike.”
The non-acute care part of our health care system includes the nursing homes many of our parents and elderly neighbors live in. You should be alarmed at the impact of micro-unions on the quality of patient care and the spike in the costs of this care, since Medicaid – paid for by taxpayers – is a huge spender in this field. Here is a case where you have Big Labor pressing a government agency, the NLRB, to manipulate the law in order to unionize more private sector employees, at the expense of our senior citizens and the U.S. taxpayer.
Micro-unions in any industry balkanize the workplace, undermine collective bargaining as a mechanism for labor peace, and dramatically increase employers’ labor relation’s costs, which damages the economy and hinder job creation. Micro-unions in the health care industry do that and much more. But for the Obama NLRB nothing matters other than its damaging hyper-partisan union agenda.
This entry was posted in Big Labor Bosses, micro-unions, NLRB, Politics and tagged California Nurses Association, Carnegie Mellon University, Congress, Federal Mediation and Conciliation Services, Health care, Heritage Foundation, Micro-unions, MIT, National Labor Relations Act, NLRB, Red Cross, strike, Vanderbilt. Bookmark the permalink.