By Don McIntosh

More than 80,000 workers in six states could go on strike at Kaiser Permanente in early October if the thriving non-profit health provider doesn’t drop its demand for contract concessions. If the strike happens, it would be the biggest in the United States in 22 years, since the Teamsters struck UPS in 1997. The workers who would strike are members of 11 local affiliates of Service Employees International Union (SEIU), Office and Professional Employees (OPEIU), and Technical and Professional Employees (IFTPE) that bargain together as the Coalition of Kaiser Permanente Unions (CKPU). In Oregon and Southwest Washington, the strike would involve 4,500 members of SEIU Local 49.

Kaiser is the most heavily unionized health provider network in the nation, and one of the biggest, with 39 hospitals and 701 medical offices in eight states plus the District of Columbia. By all accounts, it’s doing extremely well, with $85 billion gross annual revenue, and net profit of $5.2 billion in the first six months of 2019. Kaiser is also unusual in the health care industry: As a non-profit health maintenance organization (HMO), it operates in much of its territory as both an insurance company and a network of hospitals and clinics. Kaiser has had a special relationship with unions over the years, and up to two-fifths of Kaiser’s 12.3 million members are in households that get their health insurance through a union.

 

But leaders of the Coalition of Kaiser Permanente Unions have been putting out word that Kaiser is no longer the union-friendly partner it has promoted itself to be under a two-decade-old labor-management partnership agreement. The union leaders say Kaiser has been outsourcing and automating union jobs, understaffing facilities, and raising patient premiums, and is now seeking to reduce worker wages and benefits in union contract negotiations.

 

“There’s no question about it: Kaiser has lost its way, from a corporation geared toward partnership to one solely focused on inflating profits and enriching top executives,” said Sean Wherley, spokesperson for SEIU United Healthcare West, the largest of the coalition unions. “Workers want to get the partnership back on track. They want Kaiser to put patients and workers first, and return to the mission of being a non-profit community based health system.”

Kaiser paid its CEO Bernard Tyson $16 million in 2017, the most recent year for which IRS non-profit disclosures are available. That’s more than Nike paid its CEO that year. Kaiser also paid 35 other executives more than $1 million in 2017. [See the full list here starting on Page 16.]

And yet in union contract negotiations, Kaiser is asking for multiple take-aways and is pushing proposals that would create division between new hires and incumbent workers, and between workers in California and other Kaiser regions. For starters, SEIU says Kaiser proposed that new hires no longer get a defined benefit pension. Kaiser spokesperson Michael G. Foley wouldn’t confirm or deny that Kaiser initially proposed that, and said via email that the news media isn’t an appropriate venue for back and forth bargaining. But Kaiser is proposing to eliminate — for new hires only — its promise of retiree health insurance subsidies. It’s also proposing to pay some new hires 15% less for three years while they learn on the job. It’s proposing to increase health insurance co-pays for all workers. And it’s proposing different raises depending on region: California workers would get raises of 3% a year, but Oregon workers would get 2% and Colorado workers would get as little as 1%.

The Coalition of Kaiser Permanente Unions has said no to all of those concessionary proposals, and is proposing annual wage increases of 3 and 4% across all of Kaiser’s territory. It’s also proposing contract provisions that would halt outsourcing and limit any automation that results in worsened patient care.

Cindy Vanderveer, a phlebotomist at Kaiser Sunnyside Medical Center and a member of SEIU Local 49, says she’s seen up close how Kaiser staffing cuts have pinched patient care: When she started five years ago, Sunnyside had seven phlebotomists on her night shift. Now there are three.

Workers across the Kaiser system have similar stories of Kaiser cutting corners on labor costs. In California, Kaiser has outsourced several hundred union jobs, including shuttle drivers, parking lot attendants, warehouse workers and couriers. At its Interstate campus in North Portand, Kaiser replaced its popular healthy food cafeteria with vending machines, and laid off about 15 members of SEIU Local 49.

Local 49 President Meg Niemi says her members who work in patient registration can face discipline if they don’t push patients to use kiosks to check themselves in.

“We all know where that leads,” Niemi said. “The day may come when you show up at Kaiser Permanente and your only choice is to try to check in with the kiosk.”

Vanderveer — who serves on the national bargaining team —said the vote to strike was not a decision that workers made lightly: “Kaiser left us no choice,” Vanderveer said. “Kaiser needs to do the right thing. They need to invest in their patients and employees.”

Kaiser vice president John Nelson called the strike vote “counterproductive and simply a bullying tactic” in an Aug. 13 public statement. “SEIU-UHW leadership is more interested in a power play to position themselves vis-a-vis other Kaiser Permanente unions,” Nelson wrote.

The other unions Nelson was likely referring to are 22 local unions totaling 47,000 Kaiser workers that withdrew from the decades-old CKPU coalition in March 2018 after internal conflicts with the leadership of its largest member, SEIU United Healthcare West. The breakaway unions formed their own coalition, the Alliance of Health Care Unions, and reached a multi-union agreement with Kaiser in September 2018 after months of tense bargaining. Northwest locals in the Alliance of Health Care Unions include Oregon Federation of Nurses and Health Professional Local 5017-American Federation of Teachers, and UFCW Local 555.

Niemi says in the Northwest, members of the two coalitions have maintained good relations: “I have commitments from UFCW and OFNHP that they will do everything they legally can to support our members in case of a strike.”

The two sides haven’t met to negotiate since July 11, but are scheduled to meet again for negotiations on Sept. 16.