PowerPoint Presentation
Collective Bargaining in an Era of Healthcare Reform; How One System Saved $18 Million Through NegotiationsBrian Sweeney, RN, FACHEVice President for Clinical & Support ServicesJoseph Anton, RNVice President for Clinical & Support ServicesOrganizational profile & union environmentContract negotiationsStrike preparationsOutcome and return on investment
Agenda2Describe how to formulate a strike plan to strengthen your negotiating position and minimize revenue loss from a work stoppage.Identify tactics to reduce operating expenses associated with a collective bargaining agreement. Demonstrate how to assemble a negotiating team that will lead to optimal outcomes. Objectives3I. Organizational Profile and Union Environment4Philadelphia, PA953 bed academic health system3 hospitals46,000 admissions100,000 ED visits8,000 employees3 unions
Organizational Profile5
Affiliate of National Union of Hospitals & Health Care Employees, AFSCME, AFL-CIO72,500 national/17,000 local/1,ooo Jefferson membersExperienced leadership teamSimultaneous negotiations with 4 hospitalsPrevious strikesKey positions: EVS, nursing assistants, transport sterile processing, nutrition, mail room & supply chain
Key Facts District 1199c6Different TimesHigher Stakes7
8
9
II. Contract Negotiations10Secure a realistic and responsible collective bargaining agreement given ACAMaintain high quality careProtect patients, visitors, and staffContinue academic activitiesMaintain image/reputationMinimize revenue lossProvide consistent messagingNegotiation Objectives11Engage multidisciplinary teamsAnalyze dataDevelop formal plansSynchronize timelinesCommunicate effectivelyEducate union Approach12Hospital administrationUniversity administrationHuman resourcesInternal counselOutside labor counselSupport financial administration
Negotiating Team13Total annual cost of contract = $52.5 millionWages - $36 millionHealth and welfare - $12 millionPension - $3.9 millionTraining/legal - $720,000
Starting Point14Challenges:Highest wages in marketplacePayroll drives pension costsUnion will oppose anything reducing duesGoals:Preserve current workforce salariesTwo tiered wage structure# 1 - Wages15Challenges:Multi-employer planMost costly benefitRich plan with low co-paysHigh ED utilization & low PCP engagementGoals:Maintain contribution rate for 30 monthsReduce benefit costsActivate disease management
# 2 - Health and Welfare Benefits16Challenges:Grossly underfundedFreeze is best optionLimited options with federal requirements$62 million withdrawal liabilityRate increase in 2014Goals:Migrate to defined contribution plan Develop hybrid alternative
# 3 - Pension17Challenges:Poor attendancePaying OT to cover call outsRight to use timeImplement for non-union employees firstGoals:Migrate to ETO planResolve other matters first# 4 - Earned Time Off (ETO)18III.Strike PreparationsPotential scenariosContract ratification prior to expirationContract expiration/pre-announced strike10-day noticeUnannounced walkoutContract Ratification or Strike?20
Strike PreparationsChallenges:Take firm position to reduce 1199C expenses, increasing likelihood of a strikeUncertain when strike will occur Goals:Minimize disruptions to operationsMaintain security for patients, visitors, and staffMaintain image/reputation through aggressive PR
Financial Implications of StrikeStrike estimated to cost $1.5 million for 8 weeksReduction of 1199C payroll helps offset expensesReduced admissions budget Unable to quantify risk of PR/media exposureConfidential playbookFormal written documentMultidisciplinary involvementClear written procedures with accountabilitySet timelines
Developing A Strike Plan23Staffing plan - day 1-7 - internalRedeploy non-clinical staffTrain within 7 days of contract expiration - visibleStaffing plan - day 8+ - externalLarge, experienced national firm CostAuthorization to deployLogisticsReplacement Staffing24
JeffersonOutside security firmPhiladelphia PoliceUS Marshall ServiceSecurity25
Hired outside crisis communication firmDeveloped tools for departmental managers FAQs, progress reportsTrained spokespersons for media inquiriesPrepared statements for patients, media, & vendorsMonitored social media PR/Communications26
27
28
Verified vendors will deliverStockpiled medical/surgical supplies, pharmaceuticals, and office suppliesSecured refrigerated trailer for perishablesIdentified off site depots for deliveriesUsed undercover vehicles for deliveries
Supply Chain29Prepared injunctionsEmergency arbitration hearingConducted management educationReviewed communicationHold union accountable for following lawsNotification to DOH/Joint CommissionLegal and Regulatory30Test the planDid people read it?Did we miss anything?Are we ready?ScenariosAccess to loading dock will be impeded for an extended period of time given an excessive number of protesters.What is the alternate plan? How is it implemented?
Table Top Exercises31Leads implementation of the strike plan Staffed 24/7Labor hotlineMonitor campus securityCoordinate deliveries, communication and staffingMonitor media activity and coordinate responseLabor Operations Center (LOC)32
Coordinate logistics for inbound staffTravel, hotel, meals, transportationIdentificationHealth screening and immunizationsSchedulingRecord keepingTraining with department managers
Staffing Center33Demonstrate preparation to reassure patients/staffProtect perimeterCoordinate efforts with law enforcementVideotape picket line activities to gather evidenceProvide executive protectionEscort employees and vehicles safely in and outSecurity Responsibilities34Rallies35
36
IV.Outcome and ROI37Settled on July 1st at 3 amSix year agreementHealth and welfare reopener in July 2014$18,609,304 million in savings over life of contractWages/pension - $12,391,486 Health and welfare - $1,913,868 ETO -$4,303,680Results38Cost of strike preparedness - $262,000Legal fees - $240,000Public relations firm - $36,000Total -$540,000
Return 35 x initial investment
ROI39OT hours per payBefore - 1,310After - 591Time off hours per payBefore - 5,887 After 2,388ETO40Engage operational leaders in negotiations and strike preparationsLink negotiations to strike preparationsEnsure preparations are visibleBe sure you are ready to take a strike!Continue communication on terms after ratificationUnderstand role of other hospital settlementsAfter action review we will do it again in 6 years
Lessons Learned41
