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Health Unions Flex Political Muscle in Opposing New D.C. Hospital

Jan. 16, 2020, 10:46 AM

Labor groups are pledging to use their political influence to try to scuttle Washington, D.C.'s plans to replace a failing hospital in one of its most disadvantaged neighborhoods unless the deal, at minimum, guarantees that workers keep their jobs and union contract.

The District of Columbia government has been negotiating since 2018 with operator Universal Health Services Inc., and its business partner George Washington University, over terms to replace the only hospital in the city’s Southeast quadrant. The public-private partnership would create the first new hospital in almost 20 years in the nation’s capital.

Negotiations stalled last year over legislation that sought to establish an academic affiliation with Washington’s Howard University. GWU Hospital said its agreement with GWU Medical School bars it from partnering with other regional universities to run similar facilities. Tensions between GWU and UHS, including a recent lawsuit between them, also stalled progress.

But interviews with council members, administration representatives, and union leaders show there hasn’t been much discussion regarding another complicating factor—a pair of local health-care unions’ objections to UHS’ employment practices and selection as hospital operator.

“What we want to definitely stress is that UHS is not the right partner for this hospital,” Yvonne Slosarski, communications coordinator for 1199SEIU United Healthcare Workers East, said in an interview. Slosarski said an ideal outcome for 1199 would be for the district to abandon current negotiations and work with a different operator.

“If the deal falls apart because of the union in some way, then the union has done its job—not only for the health-care workers at the hospital but also for patients,” Slosarski said.

The situation illustrates labor’s key role in the politics of local development in Democratic jurisdictions such as Washington, and in so-called union towns. The same sort of adamant opposition from organized labor arose in New York City lawmakers’ 2014 negotiations to replace the former Long Island College Hospital, as well as a 2019 deal to bring a new Amazon.com Inc. headquarters to Long Island City.

The original timeline for Mayor Muriel Bowser‘s administration to present a deal for the D.C. Council’s approval was Dec. 31, 2018. City Administrator Rashad Young also told Bloomberg Law in late 2019 that the administration would “be able to advance something for the council’s discussion and deliberation” by Jan. 1, 2020—although that target also passed without a new announcement.

Now, even as district officials say they plan to deliver a final agreement early this year, the parties still have a “fair amount of disagreement” over what labor protections should look like, Young said.

“We’re really pressing to get to a conclusion here,” Young said. The parties “have found a way forward on many of the important issues,” the city administrator’s office said in a later statement. When asked if that included labor progress, the office responded, “labor is included as it relates to our team and hospital partner.”

Deal Not in the Clear

There’s little argument that there’s a need for better health care in the neighborhoods the new hospital would serve. A 2018 study by Virginia Commonwealth University for the Metropolitan Washington Council of Governments found that residents in a census tract near where the hospital would be built can be expected to live about 67 years, compared to 86 years in the city’s Georgetown area.

Labor is one among many considerations in the plan, the city administrator said, adding that other components, like real estate, also need to be ironed out.

It’s also unclear how GWU’s lawsuit against UHS may have affected, or will continue to affect, negotiations. The university is alleging that its business partner improperly diverted over $100 million from the hospital.

“The councilmember is concerned that the GW/UHS lawsuit raises questions about both the health of the negotiations and UHS’ fitness for running the new hospital,” said Sam Rosen-Amy, chief of staff in D.C. Council-member Elissa Silverman’s office.

Still, the labor issue has been a central cause of the protracted discussions.

UHS owns 80% of GWU Hospital’s equity, in partnership with the university. The company is one of the country’s largest operators and providers of hospital and psychiatric services.

The district has seven full-service hospitals but only one, United Medical Center, provides acute care services for Southeast D.C.'s more than 160,000 residents.

About 230 workers at UMC are represented by the District of Columbia Nurses Association, and 1199SEIU represents roughly another 450. The unionized workers include nurses, technical employees in laboratory services and radiology, food and nutrition service workers and others.

Bowser announced last year that a new health-care system would open by 2023 to replace UMC, which will wind down operations.

All UMC workers would likely be laid off under the current plan with opportunities for “qualified workers” to apply for positions at the new hospital. But it’s unclear whether workers at the UHS-operated facility will be unionized.

That’s where the contention lies.

Tainted Labor Relations?

1199SEIU is still litigating a labor case against UHS after the company moved to oust the decades-old union at the GWU Hospital facility.

A National Labor Relations Board judge found that the GWU and UHS partnership engaged in unlawful actions over nearly two years that “endeavored to strip the Union of its role in representing” a unit of dietary and service workers, saying a number of its witnesses weren’t credible and that managers may have played a role in an employee-organized petition to decertify the union. The company is appealing the decision.

UHS referred questions and requests for comment to GWU Hospital.

“GW Hospital supports and defends the rights of its employees to decide the issue of unionization by secret ballot election after a full, fair and open campaign where all sides are heard in accordance with” federal labor laws, Christine Searight, senior communications director for the hospital, said in an email.

“UHS and GW Hospital respect the rights of employees to join a union as well as their rights to withdraw recognition of the union,” Searight said.

‘Successor’ Business Test

Negotiations for the new hospital seemed to reach an impasse in December 2018, when GWU Hospital CEO Kimberly Russo said it wouldn’t be involved in the deal unless the D.C. Council scrapped certain related legislation, including an amendment that required it to hire and accept the collectively bargained contracts of UMC employees.

UHS eventually said it would agree to remain neutral if organizers try to unionize—as opposed to mounting an anti-union campaign—but the unions wanted a stronger commitment, according to a representative in council member Elissa Silverman’s office who asked not to be named to avoid prejudicing the negotiations.

The unions say they have an agreement with the district that should simply carry over to the new facility. The government has a role in overseeing UMC employees’ collective bargaining agreements because it owns the facility and land, although it doesn’t operate the hospital.

But some district officials agree with UHS that the new East End Hospital would be an entirely new entity—meaning UHS isn’t a “successor” business legally obligated to continue a union contract.

Vincent Gray, a former mayor who now chairs the D.C. Council’s Committee on Health, said he doesn’t know how a deal would pass the council without offering preferential hiring to UMC’s current workforce—prioritizing former employees’ applications over others—even if the new facility isn’t a straightforward successor. But a union successorship agreement is a non-starter for UHS, he said.

Union: We’ll ‘Lobby Everyone’

1199SEIU and DCNA are promising a continuing fight unless the district and UHS offer more than what they described as vague guarantees for displaced workers to reapply for jobs and general statements that UHS supports workers’ rights to organize.

We’ll “lobby everyone” to oppose advancing the East End Hospital project if the deal is unfavorable to UMC’s nurses, said Wala Blegay, a spokesperson for the nurses association.

“1199SEIU represents hundreds of health-care workers who work, live, and vote in the District of Columbia. We care for District residents every day, and we see what works and what fails,” Slosarski said. “The Mayor and Council should address our members’ concerns” because “we are on the front lines of delivering care, not because of the contributions we have or have not made.”

“Continuity of care is part of quality care,” Blegay said. “For our members continuing their service to those East of the River, it should be a part of negotiations—making sure that our members will be hired at the new hospital at the same rate, under the same collective bargaining agreement.”

Young said GWU and UHS “are quite comfortable” with their employees’ right to unionize but disagreed on how it would be effectuated.

Searight wouldn’t comment on the state of talks but added, “We remain committed to that project in order to bring needed quality healthcare services to the residents of that community.”

To contact the reporters on this story: Andrew Wallender in Washington at awallender@bloomberglaw.com; Hassan A. Kanu in Washington at hkanu@bloomberglaw.com

To contact the editors responsible for this story: Bernie Kohn at bkohn@bloomberglaw.com; Karl Hardy at khardy@bloomberglaw.com