General Information

Initiatives Target Some Hospitals, Exempt Others
California Healthline

California’s health care system performs well across many areas, including care management, overall costs and cost trends. Our state’s consistently lower levels of utilization have been a major driver of lower per capita health care costs. For every major measure of hospital utilization, care provided in California’s hospitals ranks among the most efficient in the nation. As a result, California’s average per capita spending is well below the national average, despite a significantly higher cost of doing business in the state.

As we move toward implementation of national health care reform, an even greater emphasis is being placed on care coordination and financial alignment among all providers, with the twin goals of improving the quality of patient care and lowering costs.

Now, as we are on the precipice of health care reform, comes an attempt by the Service Employees International Union-United Healthcare Workers West to use the ballot box to target certain hospitals in order to leverage them to be neutral in union organizing campaigns. SEIU is attempting to qualify two initiatives for the November 2012 general election ballot. One measure is called the Charity Care Act of 2012 and the other initiative is known as the Fair Healthcare Pricing Act of 2012.

These measures are discriminatory in that the initiatives target some hospitals while exempting others. The initiatives exempt most SEIU-organized hospitals, including public hospitals, children’s hospitals, certain hospitals operated by health care plan providers (e.g., Kaiser) and certain not-for-profit hospitals based on arbitrary criteria (e.g., Dignity Health).

Only one-third of California hospitals would be affected by the charity care initiative. This means that two-thirds of hospitals are exempted from the requirements of the CCA. And only one-half of hospitals in California would be affected by the FHPA.

The FHPA would impose artificial price caps on targeted hospitals while not requiring this same mandate on exempted facilities. The same is true for the CCA, which would require targeted hospitals to provide a specified percentage of charity care (narrowly defined), while no such mandate exists for exempted hospitals. By targeting some hospitals and exempting others, these measures create a “double-standard” on hospitals across the state.

At a time when everyone is working together to implement the provisions of health care reform, these measures are counterproductive and will cause cutbacks and closures of services.

The measures also have the potential to force some hospitals to shut down entirely.

These measures have nothing to do with lowering health care costs. Rather, they are two initiatives sponsored by one labor union with its own agenda at play.

This article appeared in the Feb. 23 issue of California Healthline.