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Health & Fitness

Triage Will Be Needed for This Pyrrhic Victory

Ever wonder what a Pyrrhic Victory is? Some of California's most powerful unions may just find out the hard way.

Ever wonder what a Pyrrhic Victory is? Some of California's most powerful unions may just find out as they back a bill to have nonprofit hospitals prove that they provide enough charitable care to justify their tax-exempt status.

If they can’t, then the unions win… BUT if the hospitals lose their tax exempt status, you don’t have to be Einstein to figure out there will be reductions in force to either A) maintain their profit margins (the union view), or B) meet the rising cost of salaries as exemplified by the union contracts (the other view).

Either way, jobs will be chopped. (BTW: A Pyrrhic victory is a victory with such a devastating cost that it negates any sense of achievement or profit.) So guess what?  The California Nurses Association is pushing this legislation that would set statewide standards for what hospitals can count as charity care. (In the interest of full disclosure, I have never worked for a hospital and in fact, my late mother was an RN for 45 years.)

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This tactic, in my book, is totally understandable. Nurses as a whole are sporting a metaphoric black eye with much of the public due to a recent history of strikes up and down the state. Problem is their “without us, the level of care will suffer” PR line wasn’t borne out and, in fact, was exacerbated when the media uncovered the two-headed monster of substantially increased pay and benefits as the real issues in the strikes. How else do you explain the recent glut of AFL-CIO sponsored ads wherein nurses thrill on about making sure hospitals give you really good care? 

Under the bill, a hospital would have to show why it should keep its nonprofit status if revenue exceeds spending by more than 10 percent. Hospitals also would be fined if they fail to submit timely reports detailing their charity care. And the nurses are joined by the California Labor Federation, the California Teamsters Public Affairs Council and the California Domestic Workers Coalition.

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At the heart of the legislation are co-sponsors Assemblyman Rob Bonta, (D-Oakland, and a fairly pragmatic solon) and Assemblyman Bob Wieckowski (D-Fremont), both staunch labor shillabers. But even then, you’d have thought that Bonta’s and Wieckowski’s people would’ve sat the unions down and simply asked, “Are you sure about this?”

The nurses and other unions supporting the bill say the tax benefits the hospitals receive as nonprofit organizations are far larger than the value of their charitable work. They also claim hospitals currently count their charity care in different ways, making it difficult to compare the efforts (not an unfair assertion).

Problem is if some hospitals - that have a wider gap between revenue and expenditures - have their nonprofit status revoked, in addition to the lay-offs some might look at reducing or eliminating community services such as adult day-care centers; a move they can lay at the feet of the nurses union. Both Bonta and Wieckowski say a hospital would have a chance to explain its excess revenues before the organization's nonprofit status and accompanying tax benefits would disappear. Can you say 'media circus?'

On the one hand, I'm not surprised by the bill or the PR campaign; yet on the other, I am shocked by the glaring lack of image and issue evaluation by the nurses and the other unions. This is a classic case of be careful what you ask for – you just might get it.

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