Frontline Workers

“I was almost devastated,” says Karen Cardosa, a grocery clerk in Albany, Oregon, “when UFCW told us they were no longer offering Kaiser Permanente as an insurance option.”

Cardosa and her family had been KP members for years through the union’s Local 555 Employers Health Trust. That changed when a variety of issues resulted in KP losing the account, which covered many Local 555 members. The union continued to represent nearly 2,000 Kaiser Permanente pharmacy and radiology employees, who—as KP staff members—continued to have KP health care.

But today, Kaiser Permanente is again an option for up to 15,000 UFCW members and dependents in the Northwest region who are covered by the health trust.

New way to compete

An affordable price, high quality, a new hospital, expanded clinics and a new billing system helped win back this account. But something else was also at play.

Thanks to the Labor Management Partnership, the Coalition of Kaiser Permanente Unions and Kaiser Permanente take a joint approach to winning and keeping health plan members that is almost unheard of elsewhere in this country.

Bringing together union members and KP sales and marketing teams, the campaign helped win, expand, win back or retain 33 accounts covering 125,000 KP members in 2014, with a focus on public-sector accounts.

A broad reach

The effort spans almost every level of the organization and the unions.

Leaders of the local and international unions that belong to the union coalition play an active role in advocating for KP as the preferred health care provider when negotiating contracts or benefit programs with employers.

In addition, some 45 frontline union ambassadors spoke to 25,000 KP members and potential members at outside union and community events in 2014. “I have enjoyed working side by side with the sales and marketing representatives to promote Kaiser Permanente,” says Sera Jordan, a medical assistant, union ambassador and SEIU Local 49 member in the Northwest. “It has enabled me to share my firsthand knowledge of Kaiser Permanente and the care we provide.”

UBTs are a selling point

And unit-based teams, by giving frontline workers a voice in improving quality, service and affordability, are a big selling point for union purchasers of care. UBTs launched more than 8,000 performance improvement projects last year at every point on the KP Value Compass, including thousands of affordability projects that saved, on average, more than $40,000 per project.

“Working with our union partners, we’ve been able to come to the table with customer solutions that meet everybody’s needs—including the unions that aren’t part of KP, who have tremendous influence in purchase decisions,” says Kate Kessler, a Member Sales and Service Administration director. “We are unique in having a strong labor partnership in our own business, and we can speak that language.”

Find out why record membership matters to our current and future members on InsideKP.

I’ve had the privilege of working for Kaiser Permanente for more than 30 years, and it was clear to me from day one that there is something different about our organization and the people who work here.

We’re big, with more than 175,000 employees and 18,000 physicians who provide coverage and care for more than 10 million members. What makes us unique, though, is our mission—to provide high-quality and affordable health care and to improve the health of our members and the communities we serve—and the actions, behaviors and decisions we take to support our mission. We walk the talk.

Our success these past 70 years has been the result of a lot of tremendous work and effort, individually and collectively, by hundreds of thousands of people. Today, we are fortunate to have great people working in all parts of the organization who are well-informed, highly motivated and focused on fulfilling our mission. We have leaders at every level who are delivering better health for all.

Early in my career at Kaiser Permanente, I gained an appreciation for the important role labor has played throughout our history. In fact, labor plays a broader and very different role at Kaiser Permanente than it does in many companies across America. Part of the reason we have worked well with labor is that even when we’ve had disagreements, unions have demonstrated a lasting interest in the success of Kaiser Permanente and the employees they represent, especially during challenging times.

I also have a personal appreciation for the role of labor in our society. My father belonged to a carpenters union. Unions were a voice advocating for the American dream for my family—saying my father should get work, he should be fairly paid, he should be treated right. My father had the jobs he had and the job protection he had because of the unions stepping up and speaking out.

At Kaiser Permanente, we place a tremendous value on creating and maintaining an environment where people not only feel comfortable speaking out but are encouraged to do so—and the Labor Management Partnership unions are actively supporting this culture. We want everyone in this organization sharing their best thinking every day, so we can create the best experiences for our members and patients, no matter where, when or how they come in contact with Kaiser Permanente—which is the essence of One KP.

As we look to the future, we need to continue to bring our best thinking forward during a time of dramatic change in health care. We need to have the mindset that we are going to embrace this change and lead the industry in charting the course for 21st century health in this country, so we can carry on the legacy of Kaiser Permanente for many years to come.

When I think about the Labor Management Partnership and Kaiser Permanente’s history, I can’t help but believe the creation of the LMP was inevitable—and that it’s been the linchpin to KP’s success after the financial challenges of the 1970s, ’80s and ’90s.

From the very beginning, Kaiser Permanente’s management and its unions shared a philosophy of engagement. This culture never went away entirely, but when the competition from for-profit HMOs mounted in the 1980s, it got pushed to the background. Kaiser Permanente did what many businesses do—it reduced its workforce and made other cost-cutting changes. Union members became frustrated, believing the changes undermined KP’s mission and eroded working conditions.

The unions responded with traditional work actions and strikes.

But I’d say four milestones changed the landscape.

First, in the early 1990s, the Industrial Union Department of the AFL-CIO created the KP Coordinated Bargaining Committee to improve the unions’ bargaining position. That committee, which included most of the major unions at Kaiser Permanente, became the Coalition of Kaiser Permanente Unions. We were charged with coordinating a full-scale “corporate campaign” against KP.

But we realized we might do permanent damage to the company and to our 57,000 coalition union members. So we opted to pursue an alternative strategy. In the mid-’90s, we approached KP with a bold new idea—partnership. Unlike other union-employer “cooperation” arrangements, where management would come to labor for help after decisions had been made, the proposed partnership called for labor’s integration into KP’s management and operations structure.

After almost a year of discussions, Kaiser Permanente agreed, and in 1997, the Labor Management Partnership was formed. The decision demonstrated courage on both sides. It placed a value on the knowledge possessed at every level of the organization, from the boardroom to the front line. Building on that, we broke away from traditional, reactionary problem solving and turned to interest-based problem solving and consensus decision making.

This led to the fourth milestone—the decision to conduct national bargaining using those same problem-solving methods and to include operational leaders and rank-and-file union representatives at the bargaining table.

Other factors have contributed to KP’s financial turnaround, but there can be no denying the impact the partnership made—and continues to make—in ensuring that Kaiser Permanente is the national leader in health care, with a great place to work and industry-leading salaries, wages and benefits. Its position did not come about by accident, but by the courage of leadership and the power of partnership.

Visit Kaiser Permanente's 70th anniversary mini-site.

Ten weeks of national bargaining between Kaiser Permanente and the Coalition of Kaiser Permanente Unions concluded Saturday, June 6, when 150 union and management representatives approved a tentative 2015 National Agreement. The agreement now goes to the 28 union locals that compose the coalition for ratification and to Kaiser Permanente senior leaders for approval.

The three-year tentative agreement is designed to help unionized workers and managers achieve quality, affordability and safety of care; prepare for jobs of the future; and develop innovative solutions to health care challenges. The agreement also will enable our 3,500 unit-based teams to better deliver award-winning care and service to Kaiser Permanente’s more than 10 million members and patients.

“This is an outstanding agreement that deepens our ability to provide affordable, high-quality care to our members and patients,” says Dennis Dabney, the senior vice president of National Labor Relations and Office of the Labor Management Partnership. “Kaiser Permanente leads the industry because it is a great place to work and a great place to receive care—and the two are inseparable.”

“We’re on year 18 of a remarkably successful strategy,” says Hal Ruddick, executive director of union coalition. “Our contract is better than ever, Kaiser Permanente’s quality and service scores are higher than ever, and the organization and unions are both healthy and growing. Partnership pays off for workers, consumers and mission-driven organizations like Kaiser Permanente.”

Agreement highlights

The agreement includes wage increases in each year of the agreement (see specifics below), provides operational flexibility and bolsters joint problem-solving capabilities. It builds on the successful 2012 National Agreement, strengthening provisions for workplace health and safety, providing additional funds for workforce training and development and ensuring the consistent application of partnership principles.

The new three-year tentative agreement includes:

• Across-the-board wage increases in each year of the agreement: All employees in Northern and Southern California represented by a coalition union receive 3 percent increases in the first two years and 4 percent in the third year. Employees in the regions outside of California represented by a coalition union will receive a 2 percent increase each year of the three-year agreement. In addition, they will receive a 1 percent increase at the end of the third year.
• Enhancements to benefits such as dental coverage, life insurance and tuition reimbursement. The tuition reimbursement was increased to $3,000 per employee per year. For the first time, tuition, dental coverage and life insurance are standardized for coalition union members across all regions.
• A long-term solution that protects retiree medical benefits for current and future retirees, with no net increase to retirees’ out-of-pocket expenses, while reducing liabilities associated with those benefits.
• Increased funding to the Ben Hudnall Memorial Trust and the SEIU UHW-West and Joint Employer Education Fund to ensure career development for Kaiser Permanente’s diverse workforce.
• Improved methods for assessing unit-based team performance and for spreading and adopting successful practices.
• Updates to our groundbreaking Kaiser Permanente Total Health Incentive Plan,  which rewards employees for healthy behavior and provides incentives for collective improvement.
• Joint participation on community health projects by the coalition unions in KP’s local and regional Community Benefit programs.

Next steps

Our agreement is the largest private-sector contract in the United States this year. Once it is approved by Kaiser Permanente senior leaders and ratified by union members this summer, it will take effect Oct. 1, 2015, and be in effect through Sept. 30, 2018.

The impact of the agreement “goes beyond the words on paper,” says Jerry Vincent, the Northern California region’s director of Labor Relations. “It lays the foundation for us to continue to provide quality, affordable care for many years.”

“There were some tough moments,” Denise Duncan, RN, the executive vice president of UNAC/UHCP, says of the negotiations. “But people came back together. It was a reminder that our national agreement—and our partnership—is very strong, and we keep making it better. There’s nothing like it anywhere else.”

For more information, see www.bargaining2015.org.

Improving performance and strengthening partnership is the work of the Operational and Service Excellence in Partnership subgroup—one of three subgroups in national bargaining.

At the third session of national bargaining, members of the subgroup made recommendations on topics including improving learning, accountability, problem solving, consistency, flexibility and support for unit-based teams.

The many perspectives represented at the table—with all regions and a wide range of job types in the mix—enriched the group’s discussions.

“We are really making progress. We’re having good discussions that can help people back at work overcome barriers in their day-to-day UBT work and make their lives easier and better,” says Holly Davenport, a union representative for UFCW Local 770 in Southern California. The group is investigating ways to improve the spread of practices from one team to another and to ensure that UBT assessments accurately reflect performance.

One LMP

The subgroup is also looking at ways to improve partnership at all levels of Kaiser Permanente and at the elements—from tools to training—that affect its success.

“Our group is trying to establish the principles of partnership and ensure they’re applied consistently across regions,” says Rita Essaian, an executive administrator with Southern California Permanente Medical Group.

“No matter what region you’re in, the partnership should be the same,” says Ruby Robley, a respiratory therapist at Antioch Medical Center in Northern California and an SEIU-UHW member. “We need One LMP, just like One KP.”

First-timers excel

Many of this year’s negotiators are new to bargaining in partnership, including manager Casper Yu, the director of Dental Sales and Marketing in the Northwest. “I love how this process works,” he says. “We negotiate and still come out with great personal and working relationships. I tell people, ‘This is what it truly means to be in partnership. I get it now.’”

Operational and Service Excellence in Partnership is one of three subgroups tasked with crafting the next National Agreement. The other two are Total Health and Workplace Safety and Work of the Future.

Visit bargaining2015.org for more information, videos and slideshows and to sign up for bargaining updates.