What you need to know about Proposition 8: Capping fees at dialysis clinics
If California voters focus on protecting patients, two labor-related measures on the statewide Nov. 6 ballot are both clear calls.
We recommend a “no” vote on Proposition 8 and a “yes” vote on Proposition 11.
Proposition 8, which would limit revenues at nearly 600 outpatient dialysis clinics, is another power play by SEIU-United Healthcare Workers West, which is trying to organize clinic workers and force more hiring. It is using the ballot measure as leverage in negotiations with DaVita and Fresenius Medical Care, the two big for-profit dialysis companies that dominate the California market.
SEIU accuses the companies of price gouging. Proposition 8 would limit clinic profits at 15 percent more than specified “direct patient care” and “health care improvement” costs. Any excess profits – potentially several hundred million dollars a year statewide – would have to be given back to insurance companies. The companies also would have to pay 5 percent of rebates as a penalty to the state.
The union has also publicized allegations of roach-infested clinics, run-down equipment, shoddy patient care and overworked staff. It has marshaled the support of other labor groups, plus some health care groups and the state Democratic Party. Plus, SEIU has put in about $19 million so far to pass the measure.
If we were confident that Proposition 8 would lead to better care for patients and lower bills, we would be inclined to support it. But because this measure is so complex – as is healthcare financing in general – it’s also possible that the measure could backfire and lead to less care.
The independent Legislative Analyst’s Office warns that depending how the state Department of Public Health implements Proposition 8 – including which costs are counted to set the revenue cap – and how dialysis companies respond, some clinics may close and fewer new ones would open.
About 80,000 Californians need dialysis, so the last thing we should do is put their health in jeopardy through a ballot measure with very unpredictable results.
Proposition 8 is opposed by more than 100 groups, including the big statewide associations representing doctors, nurses and hospitals, as well as patient advocacy groups. DaVita, Fresenius and other dialysis companies aren’t taking any chances, though. So far, they’ve invested more than $47 million to defeat the measure.
While SEIU has highlighted some valid financial issues, they should be addressed by state regulators – or by the Legislature, if necessary – not in a ballot measure that cannot be easily fixed if it causes problems. The same goes for patient care concerns, which should be dealt with by public health officials.
Yes on Proposition 11
While Proposition 8 is backed by labor, Proposition 11 is on the Nov. 6 ballot due to a pro-worker court decision.
In 2016, the state Supreme Court ruled that on-call meal and rest breaks violate state labor laws, and that employers must provide off-duty breaks that cannot be interrupted, even for emergencies. While that case involved private security guards, emergency medical technicians and paramedics have filed similar lawsuits, and it appears likely that ruling will soon apply to private ambulance companies, too.
So the companies, led by American Medical Response, took the issue to the ballot and have put in nearly $7 million so far to pass it, though there is no organized opposition as yet. Proposition 11 would allow the companies to continue their longstanding practice of requiring their paramedics and EMTs to stay on duty during meal and rest breaks in case of 911 calls.
For heart attacks, strokes and other medical emergencies, every minute counts. So if the court ruling covers paramedics and EMTs, it could have dire consequences. Private ambulance firms provide about three-fourths of the emergency trips in the state, according to the Legislative Analyst’s Office.
EMTs and paramedics typically work 12-hour shifts, and being on call makes it difficult to plan meal and rest breaks. But they can squeeze them in during down time; it’s also what they signed up for when they took the job.
In addition, there is a financial downside to patients and taxpayers if this measure fails: Ambulance companies would face higher costs for providing off-duty breaks – possibly more than $100 million a year – and the LAO says that much of those costs would be passed on to insurance companies and county governments that contract with the companies.
We generally support workers and their rights on the job. On these ballot measures, however, patients have to come first.