Health care unions in New York are fighting back for better pay

You heard them blocks away before you saw them.

Echoing through the concrete canyons of Washington Heights in Manhattan was a cacophony of noisemakers, plastic bucket drums, whistles and cowbells, wielded by scores of boisterous health care workers. The lunchtime protest outside NewYork-Presbyterian’s Columbia University Irving Medical Center was held late last month in opposition to a proposed $1.2 billion Medicaid cut in New York’s state budget. At other hospitals across the state, thousands of unionized 1199SEIU workers and their supporters mounted similar rallies.

Meanwhile, on cable and over the airwaves, an eight-figure media barrage funded by a coalition spearheaded by 1199SEIU and the Greater New York Hospital Association demanded that Gov. Kathy Hochul not only reverse the Medicaid cuts but fund the program more robustly.

For many in the health care sector, the specter of the funding cuts marks a stark shift. 

Just a few years ago, the site of the Upper Manhattan protest was one of many neighborhoods where, during the darkest days of the coronavirus pandemic, sequestered New Yorkers ventured out onto their fire escapes to bang pots and pans in appreciation of health care workers.

Over 3,600 U.S. health care workers died as a consequence of their occupational COVID-19 exposure in that first year, 453 of them from New York, according to a Guardian and Kaiser Health News investigation. Dozens were unionized members of 1199SEIU, the New York Nurses Association or District Council 37.

During the pandemic, the federal government required that nobody be removed from Medicaid, a lifeline for some 7.5 million New Yorkers – including about 65% of whom are people of color and over half of whom are employed. Last year, Gov. Kathy Hochul championed a significant increase in Medicaid reimbursement rates, and the year before she touted a $10 billion allocation as the “largest investment in health care in state history.” Now, she’s describing her proposed cuts as fiscally necessary.

But after the expiration or scaling back of pandemic-era boosts in government support and chronic financial problems plaguing health care institutions, front-line workers are grappling with new challenges – which pose a major test of the power of New York’s health care unions.

“The governor said cutback – we said fight back,” 1199SEIU members chanted amid a raucous atmosphere in a crowd that included hospital management. They directed their vitriol at Hochul, who they had campaigned hard for less than two years ago as a health care worker champion. “We voted for her and now she drops us,” murmured someone in the crowd. 

Michael Ashby, a vice president of 1199SEIU who organized the Manhattan rally, praised hospital management for agreeing last year to reopen the existing union contract in recognition of the severe post-coronavirus staffing shortage.

“We fight with them when we need to fight them, but in this fight we are united with them against the governor,” Ashby told the cheering crowd. “Last year, we told the employer we are the heroes that got you through this pandemic – we need you to reopen the contract and let’s renegotiate the wages and they did the right thing and we fought for and got a 7%, 6% and 5% increase, and we kept our health care benefits from cuts. But the employer said to us that they were concerned because if the governor doesn’t fund Medicaid the way she is supposed to, then we will be one of the institutions that are going to take a hit.”

In an interview with City & State, Ashby said the state’s long-standing formula, which only pays 70% of the total cost of a hospital stay for Medicaid patients, along with the planned cuts, reinforced the race-based health disparities that elected officials bemoaned during the pandemic.

“So, if I go to a hospital in a ZIP code where there aren’t many Medicaid patients, those hospitals get reimbursed at a higher rate, but what about if it’s a community like Washington Heights where people are on Medicaid and that’s where the cuts to Medicaid are directly affecting this community,” Ashby said. “Health care shouldn’t be based on the ZIP code you live in.”

Across the country, a resurgent labor movement is more inclined to strike than it has been since Ronald Reagan became president. United Auto Workers and Screen Actors Guild-American Federation of Television and Radio Artists won landmark contracts that reversed a generation of givebacks and wage stagnation. In October, 75,000 union health care workers employed by Kaiser Permanente in several states won a 21% pay increase over four years following a three-day strike, the largest such action in U.S. history. The tentative deal included restrictions on outsourcing and measures to promote staff retention, a key concern of the coalition of unions led by the Service Employees International Union. “Millions of Americans are safer today because tens of thousands of dedicated health care workers fought for and won the critical resources they need and that patients need,” Caroline Lucas, executive director of the Coalition of Kaiser Permanente Unions, said in a statement at the time. “This historic agreement will set a higher standard for the health care industry nationwide.”

In New Jersey, 1,700 members of United Steelworkers Nurses Local 4-200 went on strike from August to December against New Brunswick’s Robert Wood Johnson University Hospital over staffing issues and emerged with a landmark contract.

They were following the lead of the New York State Nurses Association, which went on a three-day strike in January 2023 at Mount Sinai Hospital in Manhattan and Montefiore Medical Center in the Bronx. The 7,000 NYSNA nurses, driven in part by low Medicaid reimbursement rates and low staffing ratios predating the COVID-19 pandemic, won breakthrough wage and staffing guarantees.

In August, NYSNA won a contract with NYC Health + Hospitals that provided for the largest wage increase in New York City’s public sector nurse history. According to NYSNA, the pact corrected a “historic wrong” that started when the municipal system’s “pay parity contractual clause was suspended in the 1990s” resulting in a wage disparity opening up “between public and private sector nurses (that) grew to unjust and unsustainable levels.”

Now, with the pandemic emergency declared over by the Biden White House more than a year ago, New York’s health care unions have been helping to shape the national debate – but the fight is far from over. Months into 2024, hospitals are still struggling to recover financially – with concerns over closures reported in upstate New York, Brooklyn and lower Manhattan.

State Sen. Jessica Ramos, who chairs the Labor Committee and supports fully funding Medicaid, represents the Queens neighborhood that’s served by NYC Health + Hospitals’ Elmhurst Hospital, where pandemic conditions were described as “apocalyptic.” 

“It’s the only trauma hospital in western Queens, because we have seen in Queens five hospitals actually close over the last 20 years even though the population continues to increase,” Ramos told City & State. “When you talk to our doctors they will tell you they are already struggling with a very high volume of patients and serious cases such that they are having trouble recruiting new doctors and new nurses because their wages can’t compete with the wages that are $40,000 higher in Manhattan across the river.”

One of the biggest post-pandemic tests for health care unions is Hochul’s latest budget.

The governor’s press office did not respond to multiple queries about the 1199SEIU and GNYHA’s media blitz calling on Hochul to shift the state toward ending its practice of covering just 70% of the real cost of caring for the state’s Medicaid recipients.

But the governor said her proposed spending cuts were essential to balance the budget.

“I’m going to address our spiraling costs and just tell you like it is,” Hochul said during her January address presenting the details of her proposed $233 billion budget. “Our Medicaid spending exceeded our projections this year by $1.5 billion.” She added that 200,000 more people than anticipated remained on state-funded Medicaid after the federal government ended its supplemental pandemic support, costing the state an additional $400 million annually. “On top of that, to make matters worse, the state is still awaiting repayment of a $1.5 billion one-time bridge loan made to financially distressed hospitals,” she continued, “which actually are about one-third of the hospitals in the state.”

The governor, who in 2022 before her reelection campaign pledged a generous $10 billion direct payment to the beleaguered hospital workforce to “stop the current hemorrhaging of health care workers,” was now reverting back to her predecessor’s strategy of convening expert panels to do the heavy lifting, like the state Commission on the Future of Healthcare and the state’s Master Plan for Aging.

To be fair, this shift to austerity from Hochul’s previous budgets did not happen in a vacuum. It comes with a population outmigration that Hochul estimates has already cost the state $6 billion in lost revenue. New York state has also struggled with the humanitarian crisis amid an influx of migrants. There’s ongoing gridlock in Washington, D.C. There were macroeconomic budget concerns that the unprecedented federal pandemic spending had set off an inflationary spiral that would crash the entire economy. And there was the decision by the White House to pull the plug on pandemic-era public health programs, including “unwinding Medicaid,” that left states like New York scrounging for how to pay to maintain the swollen enrollment for the health care program. 

According to a comprehensive 50-state analysis by Georgetown University, the “unwinding” resulted in almost 10 million people losing Medicaid, including over 3 million children. The range in impact was significant, with Texas taking the opportunity to reset the program by dropping just over 24%, or 1.4 million of their state’s Medicaid recipients. By contrast, New York state saw just a 4.5% shrinkage of the rolls, with 320,000 off the program as of October.

In Albany, 1199SEIU and GNYHA backed legislation sponsored by Assembly Member Amy Paulin, chair of the Health Committee, and state Sen. Gustavo Rivera, chair of his chamber’s Health Committee, that would move the state over four years from its current 70% reimbursement rate to 100%.

“Right now, we are faced with a budget that is very stark,” Paulin told City & State. “There are a lot of cuts in addition to everything else. You start with a workforce shortage that’s very severe since COVID and you compound that with hospitals that are in financial distress – 29% in distress – and many more on the borderline of being distressed. So, it’s just a tremendous problem we are faced with.”

Rivera said he was encouraged by Hochul’s first budgets that were “moving us in a different direction from the previous administration.”

“All of the sudden, she has taken a hard turn and she is leading with austerity and the lesson that has not been learned I am sad to say is that leading with austerity doesn’t give us a stronger system,” he told City & State. “It just makes it that much more expensive and of lower quality in the long run.”

Meanwhile, 1199SEIU is lining up their labor allies behind their proposals. Fresh of big labor wins, both UAW and NYSNA are on board. Mario Cilento, the president of the 2.5 million-member New York State AFL-CIO, said the umbrella labor organization “fully supports 1199’s efforts.” Henry Garrido, the executive director of District Council 37, noted that New York City’s largest municipal union had supported reimbursements for safety-net hospitals who cover Medicaid recipients and would “continue to advocate for increasing Medicaid funding, because we represent so many working people who rely on it for their health and well-being.”

32BJ SEIU, which won a victory last year with its push for transparency around hospital costs, is also on board with 1199SEIU’s advocacy for a better Medicaid reimbursement rate. The effort “has the benefit of being right for patients, right for workers, rights for hospitals and right for New Yorkers,” 32BJ SEIU President Manny Pastreich said in a statement. “By comparison, the current ‘math’ requires that hospitals charge union health plans and private payers three to four times Medicare rates to balance their books for Medicaid underpayments. That’s flat out unsustainable.”

Albany has until April 1, when the state budget is due, to sort this out.