Kaiser, Union Ally to Help Each Other Out

Attempting to seize the high ground in a managed-care industry beset by criticism, Kaiser Permanente and the AFL-CIO said Thursday they formed a national partnership to work together to improve the quality of medical care at the nation’s biggest HMO.

But the partnership would also have bottom-line benefits for the union and Kaiser. The union said it won promises of greater job security and increased involvement in management decision making. In return, the union will help Kaiser market its medical services to union health plans and welfare trusts, and to help enhance its public image generally.

“Our commitment is to promote Kaiser as a top-quality health-care provider with organized workers and a cost-effective program,” AFL-CIO Chairman John Sweeney said at a joint news conference with Kaiser Chief Executive David Lawrence.

The union also won a promise from Kaiser that it would take a “neutral” position on organizing activities at Kaiser facilities that are not currently unionized, mainly in the Southeast, Southwest and Northeast.

Kaiser, which got its start in the early 1940s as a prepaid health plan for California shipyard workers, has traditionally had good relationships with organized labor. In recent years, as Kaiser has faced stiff competition and struggled to reduce costs, relations with its unions have soured.

The HMO has faced especially withering criticism from the California Nurses Assn., which is not affiliated with the AFL-CIO and was not a party to the agreement. The CNA, which is involved in a contract dispute with Kaiser, has complained of deteriorating patient care at Kaiser hospitals.

Thursday’s announcement is partly an attempt to patch up relationships with a group of 30 union locals who represent more than 50,000 Kaiser workers.

Andrew Stern, president of the Service Employees International Union, described Kaiser as “an extremely concerned provider” that “recognizes the need to improve its quality instead of just making more money.”

Added Sweeney: “It’s no secret that this proposal is being put forward during troubled times for union workers. As Kaiser has struggled to compete in the new world of health care, we’ve been buffeted by downsizing and restructuring, closing of major facilities, layoffs and concession bargaining.”

Kaiser and union officials used such terms as “historic” and a “noble experiment” to describe a deal they billed as a model of labor-management cooperation. They likened it to such innovative agreements as those struck by auto workers and General Motors’ Saturn division in the mid-1980s.

UCLA labor economist Daniel J.B. Mitchell said the AFL-CIO-Kaiser agreement, though perhaps a first for the health-care field, has precursors in other industries.

“You can find examples in other industries where the union tried to promote employers in difficult circumstances because the union’s welfare is partly dependent on the employer’s welfare,” Mitchell said. An example would be textile workers’ support of “Buy America” campaigns or auto workers’ concessions to Chrysler Corp. during its 1979-80 financial crisis.

“To the extent that the unions can recommend Kaiser and be more friendly to Kaiser, yes, it could encourage more employers to become Kaiser subscribers,” Mitchell said. “But if it goes on for a year and Kaiser faces more economic difficulties, the whole thing could get unraveled.”

Sweeney rejected suggestions that the deal--which is not part of a legally binding collective bargaining agreement--would provide only a token voice for labor in decision making. “We will be involved right at the very top of the decision-making process,” he said. “We will have extensive access to [corporate] information not available to us through the collective bargaining process. . . . We’ve wanted this for a long time.”

The California Nurses Assn. blasted the union-Kaiser deal.

“The implication is that [by] signing this agreement that Kaiser already has an outstanding quality-assurance program,” said CNA spokesman Chuck Idelson. “We don’t agree.”

Texas this week issued a report criticizing the care provided by Kaiser’s division in that state. Kaiser said the report was based on incorrect information.

“This agreement has nothing to do with quality of care,” Idelson said. “The first purpose is to gain market share. That’s Kaiser’s fundamental concern.”