Union drops CA initiatives to cap hospital CEO pay, limit patient charges

The Service Employees International–United Healthcare Workers West (SEIU-UHW) labor union officially shelved two ballot initiatives it sponsored to limit what not-for-profit hospitals in California could charge patients and pay their executives, the Los Angeles Times reported.

The union was in the process of gathering signatures for the two initiatives when it chose to strike a pact with the California Hospital Association (CHA) in lieu of dropping its campaign. The agreement will last through the end of 2017, according to the Sacremento Business Journal.

Representatives from the SEIU-UHW and the CHA suggested at a Tuesday press conference that they might have spent more than $100 million on the two ballot measures. 

One measure aimed to cap hospital charges at 25 percent above their cost. The other would limit executive pay to about $450,000 a year, far less than what many C-suite executives currently earn.

The SEIU-UHW sponsored--and was able to pass--a local initiative to limit the pay of executives at El Camino Hospital in Mountain View in 2012, but that matter has been tied up in litigation for more than a year. The union launched the two now shelved initiatives earlier this year.

"If we moved forward with the initiative war it would have been a major catastrophe for both organizations," said CHA Chief Executive Officer C. Duane Dauner, according to the Times.

The parties agreed to work together to try and extract higher Medicaid payments for the state's providers, up to and including developing ballot initiatives for the 2016 election and beyond. They pooled $100 million in a special fund for that purpose. They also agreed to a "code of conduct" that would curb their use of heated rhetoric and other similar strategies, according to the Times.

The two sides also made an agreement in 2012 after the union agreed to drop ballot proposition campaigns capping pay and making charity care requirements more stringent.

The pact may also make it easier for SEIU-UHW members to bargain with hospitals in California, although the two sides didn't provide details, according to the Times. However, only one hospital affiliated with Sutter Health, the influential Northern California hospital system, has agreed to abide by the terms of the pact, according to another article in the Business Journal.

To learn more:
- read the Los Angeles Times article
- here's the first Business Journal article
- check out the second Business Journal article

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