Thursday, April 5, 2012

Kaiser Executive Discusses Plan for Coalition Unions' Cuts

Wow. Check out this 4-minute recording from a conference call where a top Kaiser Permanente executive talks about the company’s plans to cut workers' benefits “in collaboration with” the Coalition of Kaiser Permanente Unions.

Here’s some background:

Last month -- just days before Kaiser began its negotiations with the Coalition -- Greg Adams conducted a “telephone townhall meeting” with some of Kaiser’s staff. Who’s Greg Adams? He’s the President of Kaiser's Northern California Region and is responsible for Kaiser’s 21 hospitals, 159 medical office facilities and all of its insurance operations in Northern California. Here’s his bio.

And here’s just a bit of what Adams said during conference call (you can listen for yourself below):
  • Does Kaiser want to cut workers' benefits? Absolutely. As usual, Adams offers up Kaiser’s bogus effort to “justify” the cuts and simply fails to mention Kaiser’s $6.1 billion in profits.
  • Is Adams hopeful that the Coalition will accept Kaiser’s cuts? Well, he’s not just hopeful… he's "very hopeful." In fact, Adams describes how Kaiser has been talking with its "labor partners" about the changes for a long time and that “we’ve said to our labor organizations that we want to do it in collaboration with them.”
Here’s the recording... with a transcription below:

Moderator:  Ahh, Greg, we’re getting a couple of questions coming in via email. So we’ll take one of those. This is from Marin/Sonoma. And the question is “Are there plans," folks here are wondering, “Are there plans to restructure salary and benefits?”

 Greg Adams:  Well that’s a loaded question but a very important one…

 …You know, remember one of the things that I said is that we’re dealing with a new normal - reimbursement is going down, umm, we’ve got to figure out how to operate our health plan, our delivery system with fewer dollars and that means that in order for us to be successful and compete that we have to find solutions in all areas of the organization and we’re having to do that….

…Umm, as a part of that we are looking at – and we’ve sent out an email to I think all employees – and essentially said that we’ve got to look at our cost structure as it relates to benefits and we’ve got to make sure that when we look at the escalation of our benefits going forward that they’re not escalating at a level greater than our premiums, greater than what the market can afford, and greater than this “new normal” that we’ve talked about and so umm…you know, we have to make sure that, umm, that we’re being thoughtful about how we do that. We’ve said to our labor organizations that we want to do it in collaboration with them. And we have been kind of emphatic and unapologetic and we’ve tried to be very clear in saying that we will not, umm, move away from providing benefits that are highly competitive in the market, that is simply who we are.

And so we all know that we have a very rich benefit program, I mean - it’s just the truth.
And so there’s an opportunity for us to continue to be, umm, competitive and continue to be in some ways, umm, umm, I don’t want to say a leader because....but, but to continue to really be ahead of others and…and we’re going to continue to do that. But do we have to look at if we stay on our current course what the implications are knowing what the reimbursements are, knowing what our liabilities are? We have to.

And we can do that in a way that allows us to all feel good about it and feel good about the success of the organization going forward. Thank you for that question. I’m sure it was on everyone’s mind and I’m hoping I was…clear.

Moderator: Greg, we have another emailed question from Fresno. And this one says, “Can you please comment on the status of negotiations with LMP in regards to the recent strikes?”

Greg Adams:  Well, the.. ahh... remember the recent strikes were not our, umm, Labor Management Partnership or Coalition unions. The strikes were NUHW and CNA. Neither of those are in the Labor Management Partnership or the Coalition. Umm, I will say, though, just because if you don’t know, we are in the process of entering into negotiations with the Coalition. The first day of negotiations – and these are our national negotiations with, umm, the unions that are part of the Coalition that are part of the Labor Management Partnership – starts on Tuesday of next week. I think our labor partners understand. We spent time in the last negotiations really talking about the changes, talking about healthcare reform, talking about all the things that we, ah, are going to face. So I'm very hopeful that as we engage with them over the next several months that they, with us, will be able to, umm, identify opportunities for us to make the kind of changes and to be competitive in the market going forward.