BUSINESS JOURNAL EVENT

2008 Health Care Conference: Frontiers of Health Care

Wednesday, November 12, 2008, 8:00 a.m. - 11:30 a.m., Hyatt Vineyard Creek Hotel & Spa, Santa Rosa

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Looming Sutter nurses’ strike raises costs for business

As California’s elected leaders come down to the wire in their attempts to reform our state’s broken health care system, small business leaders are hoping they do more good than harm. Small business owners are primarily interested in solutions that reduce costs of care, while increasing access to quality providers.

That’s why it is so disappointing that the California Nurses Association went on strike at 15 Northern California hospitals that are affiliated with Sutter Health and Fremont-Rideout Health Group. This decision to strike rather than continue bargaining flies in the face of attempts to improve health care access and affordability.

While I am not privy to all of the fine points of the negotiations, it is clear that bringing more than 5,000 nurses out on a two-day strike can only serve to increase health care costs for all of us.

According to press accounts, a previous nurse strike at two Fremont-Rideout hospitals just this summer cost $1 million per day. Multiply that by 15 hospitals over two days, and it’s clear that the CNA’s strike will cost these hospitals – and ultimately consumers – tens of millions of dollars. That’s tens of millions of dollars in unnecessary costs that could better be used to lower health care costs or expand technology, services or staff.

Virtually everyone agrees that nurses play an integral role in the delivery of health care. Without a doubt, along with your doctor, a nurse is the most important person responsible for the delivery of your care. Nurses deserve to be highly compensated. And by all accounts they are.

According to the Hospital Association of Southern California, the average annual salary for a Bay Area Registered Nurse is $106,120.56 per year. According to information in the press, after their economic proposal, Fremont-Rideout nurses will earn a median hourly wage of $41.67 in rural communities like Marysville and Oroville with a lower cost of living. And the average full-time nurse at a Bay Area Sutter-affiliated hospital will earn more than $120,000 per year. That’s before factoring benefits and overtime.

The CNA is on record saying these strikes are about more than wages and benefits. The union is seeking to provide contractual guarantees that hospitals will hire more and more nurses to provide break and other relief. Certainly, we would all prefer more nurses. But remember that California recently passed a landmark nurse-to-patient ratio law, guaranteeing that patients in this state already have more nurses available to them than any other state in the union.

While we would all like to have our own private nurse, we must be mindful of how such contract concessions increase the cost of care for everyone. After all, what good is it to have an abundance of nurses when no one can afford to purchase even basic levels of health insurance?

According to the California HealthCare Foundation, salaries and benefits are the largest component of hospital operating expenses, accounting for over 60 percent of the cost of care. That means that every health care consumer in this region has a vested interest in the outcome of these negotiations.

Both the hospitals and the union must work together to find common ground on two important objectives: ensuring that nurses are adequately compensated, while also being fiscally responsible stewards to ensure that access to care is not unnecessarily hindered. And by all means, both sides must do everything in their power to avoid strikes that do nothing but unnecessarily drive up costs for everyone.

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Betty Jo Tocolli is president of the California Small Business Association based in Los Angeles and representing more than 200,000 small business owners in California. She can be reached at bjtcsba

@pacbell.net or 310-642-0838.