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Pleasanton voters may have a chance next year to put a cap on how much Stanford Health and other health care providers can charge patients for medical care under a ballot initiative being advanced by the health care union.
The Service Employees International Union-United Healthcare Workers West (SEIU-UHW), which represents about 93,000 employees, filed ballot initiatives last week in four Bay Area cities that have Stanford Health medical facilities: Pleasanton, Livermore, Emeryville and Redwood City. On Thursday, the union was set to do the same in Palo Alto, home of the network’s flagship facility, Stanford University Medical Center.
Union spokesman Sean Wherley said the union decided to pursue the initiative in the five cities after learning that Stanford University Medical Center has been experiencing higher infection rates than other hospitals in the Bay Area while at the same time charging some of the highest rates for patient care. The union includes about 1,800 Stanford University Medical Center employees.
The measure would effectively bar Stanford from charging patients more than 15% above the actual cost of providing services. In a news release, the SEIU-UHW pointed to a report from the California Office of Statewide Health Planning and Development showing Stanford significantly exceeding the statewide average for various treatments.
For alcohol and drug abuse treatment, the statewide average was reportedly $27,621, according to the union. Stanford charged $100,557, more than both University of California, San Francisco ($76,230) and California Pacific Medical Center’s St. Luke’s Campus ($86,828), the union alleged, pointing to the data from the state agency.
The union also highlighted data showing that Stanford charges almost $60,000 more than the state average for treatment of kidney failures and more than $45,000 above the state average for chest pain treatment.
Wherley told the Weekly the union is concerned about this combination of higher costs and poor quality at Stanford Health.
“Now that you have Stanford expanding into (the) East Bay, there’s real concern that problems that exist in Palo Alto the overcharging and high infection rates will be brought to other communities,” Wherley said.
In response to the union’s announcement, Stanford Health released a statement saying that while it hasn’t seen the ballot language, “we would be disappointed if these efforts moved forward.”
“All hospital charges reflect the complexities of the national healthcare system as well as multiple other factors ranging from local and regional market conditions to the level of care being provided,” Stanford’s statement read. “We take this seriously and we certainly want to respond on behalf of our patients and the communities we serve once we see the proposed language.”
The proposed ballot language states that the purpose of the ballot measure is to “provide for the orderly regulation of hospitals and other health facilities” by providing “minimum standards and regulations regarding their operation.”
“The prices charged to patients and other payers have far-reaching effects on consumers purchasing health care services and insurance, as well as taxpayers supporting public and welfare programs,” the ballot statement reads. “Investments in quality of care improvements can benefit patients and caregivers, and ultimately result in lower overall health costs.”
If approved by the voters, the new cap would take effect on Jan. 1, 2019. It would require hospitals and clinics to calculate its health care costs and compile, for each patient, a list of information that includes the total amount received in payments; the “reasonable cost” of the provided care; and, where applicable, the amount by which the former has exceeded the latter.
The new law would require that payments made by patients to the hospital not exceed 115% of the “reasonable cost of direct patient care,” unless the hospital successfully petitions the city’s for a waiver. A waiver would only be granted if the city finds that requiring such a rate would be “confiscatory or otherwise unlawful as applied to that hospital, medical clinic or other provider.”
Even if the city grants such a petition, the waiver would offer only limited leeway. The ballot language specifies that the city would only be able to adjust the “115%” number by the “lowest whole number such that the resultant acceptable payment amount would not be unlawful.”
Even better would be an ordinance requiring hospitals and affiliated practitioners to charge cash payers no more than 120% of the lowest negotiated “in network” price they offer insurance companies.
Same process applies to the union provided services?
All of their services are union provided. So, yes, they seem to be saying they want to cap the fees.
I think SEIU should pay more attention to doing their job, than trying to manage their employer through politics.
Wouldn’t it be reasonable to hold SEIU members accountable for these high levels of infection that SEIU is complaining about?
Wouldn’t it be reasonable to consider SEIU members wages are much of the costs that Stanford Medical uses to base their fees on?
George Orwell wrote a book “Animal Farm” that may be germane to this discussion.
I smell a rat, the SEIU altruistic?
I suppose if someone wakes up in the morning shaking their fists saying “Darn those sneaky unions, trying to ruin our lives”, they might see the union at fault later that day too.
For the rest of us, I think we’re more likely to ask what is the problem they are trying to solve. I don’t have any clue why infection rates are up—that can be due to systemic lack of concern, coincidence, or incompetence—but I’d like to know why. As to why SEIU wants to limit prices, I don’t know what made them decide that. I would agree that their wages too should be limited. That’s why I suggested that the better answer is to limit the total price to 120% (or some other number) of the lowest negotiated price. That way, both the workers and the owners share equally. I suppose the union would not go for that, but it’s whats best for consumers and is fair to both workers and owners.
I’ve always found it strange that Stanford medIcine is for profit, when the university is not particularly so. Oh well. Nothing wrong with profits so long as they are transparent, fair, and meaningful.
Hospitals often care for indigent people from whom they receive little or no reimbursement. Medicaid is notorious for grossly underpaying the true cost of medical services rendered. While not nearly as onerous, Medicare is also somewhat stingy.
For many decades hospitals have mediated these revenue losses through “profits” from other patients.
I cannot see how the Union’s ballot measure will do anything but lower the quality of care below what they consider is already inadequate.
I don’t know what the Union is really up to with this measure, but I suspect it has absolutely nothing to do with medical quality, infection rates, or medical costs.
Does anyone out there know what they are up to?
Price caps never work because there aren’t cost caps.
Since businesses can’t predict what costs will be, they need to protect themselves from costs exceeding their prices. So they are forced to raise their prices to meet the cap. Then they continually lobby for increased caps, and raise prices on any exceptions to the caps.
What you end up with is something like our drug industry where U.S. consumers make up the difference for other countries (and Medicare/Medicaid) that have price caps.
Let supply and demand regulate prices. Instead of caps, how about transparent pricing? We need to know up front how much care will cost. Then, we can actually shop around a little.
If medical facilities had to publicize their prices, I imagine at least some of them would be shamed into immediately lowering them.
Great comment, Steve.
I believe that this is a trial case to advance the Democrat Party’s agenda item to force socialized medicine onto California residents.
The tactic is to drive the hospitals and other major healthcare providers out of business so that the only remaining option is rationed government-run healthcare. Ask Britain and Canadian residents what a great idea that has turned out to be!
Once Stanford is sufficiently destabilized, the refined technique will be applied to other major healthcare institutions.
All of this is very similar to the ObamaCare approach which is designed to also produce rationed socialized medical care by driving up health costs for private insurance. All the while, the legislation never contains any explicit mention of the true goal. Brilliant, though evil, tactic.
The Union is taking this on, not out of any concern for the cost of healthcare, or the incidence of infections. They are simply a leftist, ready supply of manpower to gather the signatures necessary to place this on the ballot and promote its adoption through their members.
Good luck California. We all know that you will fall for this tactic, and will cheer the demise of the current healthcare systems. Once rationed, socialized medicine takes over, it can never, never be removed–just like all other government “entitlements”.
High infection rates is a result of multiple areas of the hospital, including their own union nurses and assistants providing poor care. SEIU-UHW is literally trying to bite the hand that feeds them. They are threatening the same action against Kaiser because they aren’t getting their way in negotiations. Capping costs to patients does not allow for inflation in other areas of the hospital. How much do they think it costs to run a hospital? So cap prices, while hospital costs increase. What will this result in? Layoffs, poor quality of care, etc. Then we will hear the union again, throwing a fit about all of the above. It’s like a vicious cycle when they don’t get their way. I hope the people of California will see through this and vote down this ridiculous measure.