Labor and managed care: an uneasy alliance

Business & Health, June, 1997 by Helen Lippman

The National Labor Relations Board decided in January 1996 that the unilateral move was an unfair labor practice. It ordered Loral and Aircraft Braking to reinstate the previous coverage and bargain any future changes with the union. At press time, however, no such change had been made. "We're being victimized," says Bob Krunich of Local 856, adding that both sides had submitted briefs to the Sixth Circuit but a hearing date had not been set. Neither company returned B&H's calls.

More battles may be on the way, judging from a Bureau of National Affairs report. In 1997 Employer Bargaining Objectives, BNA details the findings of a survey mailed in June of 1996 to 600 employers with collective bargaining agreements due to expire this year. Although the vast majority of the firms already have some cost-sharing or cost-containment provisions in place, more than four respondents in 10 said they intend to raise deductibles, copays or premium contributions. Nine out of 10 also said they're "very confident" of achieving their objectives.

On the other hand, just 17 percent of the employers hoped to scale back on or eliminate a substantial part of their benefit package. That's down from 43 percent five years ago. But that could simply mean there's no fat left to trim, BNA concludes.

At the same time, union members-like most Americans--are getting a little more comfortable with managed care. Consider the experience of Steve Knox, president of United Steelworkers Local 1124 at the Lukens Steel plant in Massillon, Ohio. More than six in 10 union members have switched to a community-based HMO and saved the $700 per family deductible that comes with indemnity coverage. Knox hasn't made the move, however, mainly because his wife's doctors aren't in the HMO. Besides, he himself is a bit "leery."

Still, he has to admit that for most of the workers, managed care coverage has been problem-free: "Now that I think of it," he says, "I'm not sure I've had any complaints this past year."

RELATED ARTICLE: Kaiser and the AFL-CIO: A perfect couple?

In late April, amid news that its Texas subsidiary was fined $1 million and facing a challenge to its NCQA accreditation (see details in News & Trends), Kaiser Permanente and the AFL-CIO were hailing the development of a national partnership.

The deal, which is subject to the approval of 50,000 union members, would operate on more than one level. The union members, all non-physician health care workers employed by Kaiser, would gain input into the way patient care is delivered, and by whom. "We're getting the chance to find out that they're thinking of closing a hospital before they make the final decision," for example, AFLCIO spokeswoman Maureen Anderson says. The California Nurses Association, whose members are in the midst of contentious collective bargaining with the HMO and upset about the closing of a Kaiser hospital in Oakland, will not be signers to the agreement.

If the partnership proceeds, Kaiser employees would also get more job security, a key provision at a time when the giant not-for-profit organization faces intense competition from major for-profits, and a promise that Kaiser would not interfere with attempts to form collective bargaining units at non-union sites. The deal could also lead to more managed care-labor alliances: As their part of the bargain, the Kaiser employees would aggressively promote the HMO's services to other unions.