Then managed care cut the fat with a scalpel, limiting the length of hospital stays and the discretion of doctors, making competition among hospitals a battle of the biggest and the cheapest and drawing Wall Street investors into the game. And with the health care revolution -- the bloodless search for market share and maximized profit -- has come a new kind of labor fight.
The fight is not just another struggle between unions and management, a wrestling match focused on the particulars of overtime and cost-of-living raises. This fight is bitter and deadly serious. It's a battle about the next phase of health care and what it will look like, and the public is on the battlefield, too, packed inside a windowless trailer hitched to a supply truck that's heading down a long, bumpy road toward the front lines.
The truck is full of politicians and lawyers and consultants and public relations professionals.
On an unseasonably warm day in April, the Oakland Medical Center, one of 16 California hospitals owned by health care giant Kaiser Permanente, is ringed by employees dressed in surgical scrubs and lab coats. The employees are carrying signs denouncing the evils of what they call "corporate health care." They're encouraged by the regular honks and hoots of passing motorists -- it's not hard for unions to find support in this blue-collar city.
From the strike's epicenter, you can see the top of Kaiser's headquarters, looking over downtown Oakland, the Kaiser name emblazoned across the front of the building in familiar blue letters. It would be an understatement to say the vision is ironic; Kaiser was built by labor. Its roots stretch back to the 1940s, when Henry Kaiser began a health plan for the workers in his shipyards, angering conservatives who considered him a union sympathizer.
But that was before the huge health care organizations of the 1990s were talking about eating Kaiser's lunch.
The California Nurses Association, which represents about 7,500 nurses working in Kaiser facilities across Northern California, has declared a one-day strike against 45 Kaiser hospitals and clinics. The health care giant is demanding that the nurses take 13- to 15-percent pay cuts during the next six years, despite the company's growth. During the past year Kaiser has gained 100,000 new members in Northern California alone, a 4 percent increase.
The pay cuts are really a whopping market correction for Kaiser, which has long paid its nurses among the highest salaries in California health care. At the same time, Kaiser is offering the nurses a bonus of up to 2 percent of pay, based on the attainment of certain goals -- including financial goals. This proposal has particularly irked the nurses, who sponsored a ballot measure last November that would have banned health care firms from offering similar financial incentives to doctors. (Such incentives had led to repeated complaints that doctors working for some managed-care plans had protected their bonuses by refusing patients needed care.)
Patient care is, in fact, central to this labor-management battle, more important to the combatants, in some ways, than pay. In the age of managed care, health firms have reduced costs by wrenching down hospital admissions and limiting lengths of stay. Fewer people, therefore, are in the hospital, but those who are there are sicker. Meanwhile, the hospital industry has increasingly turned to lower-cost, less-skilled workers to handle patients, under the supervision of registered nurses, who are, by extension, responsible for more patients than in past years.
Nurses, legally accountable for patient care by the terms of their licenses, are concerned that hospital staffing is being based more on sheer numbers of patients than on how sick those patients are or what kind of care they need. The nurses want to be granted authority equal to management's when staffing levels are determined. But Kaiser has been unwilling to put those sorts of management details in a contract, and has refused to go back to the bargaining table without a federal mediator.
This strike is a particularly well-orchestrated event. Support from other employee unions, most notably Service Employees International, boosts the total number of Kaiser employees walking off the job to more than 23,000. An array of political activists, including the Berkeley Gray Panthers, have also joined the event. There is nothing like senior citizens picketing a hospital for good drama -- and good media coverage.
In fact, the public relations battle between Kaiser and the nurses has been going on for a long while now, and Kaiser is not faring well. The nurses have been throwing piles of dirty Kaiser laundry to regulators, politicians, and the media. They, in turn, have been catching and examining it.
Last fall, the California Nurses Association sponsored the Patient Protection Act, or Proposition 216, a ballot initiative that contained several provisions that are anathema to most major health care organizations. The initiative lost, but the campaign in support of it hammered health care firms with daily missives titled "Casualty of the Day." These press releases documented harmful effects of managed care across the state, many involving Kaiser, many of them fatal to patients.
More recently, the nursing union collected signatures from the entire East Bay congressional delegation and a host of local politicians on a letter that asked all Bay Area hospital administrators to stop plans to "reduce, downgrade, or consolidate" emergency or critical care services for 90 days. The letter was aimed at Kaiser, which is in the process of closing parts of its hospitals in the East Bay, including the Oakland Medical Center.
The nurses have also gone to the National Labor Relations Board, alleging Kaiser has unsafe staffing levels at some of its hospitals; the board has charged Kaiser with bargaining in bad faith for refusing to hand over information on patient care to the nurses.