Not Going to Take it Anymore – Doctors in the Pacific Northwest Unionize

Yves here. This development is very important. Nurses’ unions are effective and well respected. Doctors’ unions should be even more so, particularly since their big grievance is corporatized medicine requiring them to spend less time with patients and reducing their autonomy. As this post explains, they are at odds with management because management cares only about profit while they prioritize the quality of care. And the managers are all MBAs, so it is not as if the effort to routinize care is driven by people who in theory might have ideas about how to achieve better medical outcomes.

By Roy Poses, MD, Clinical Associate Professor of Medicine at Brown University, and the President of FIRM – the Foundation for Integrity and Responsibility in Medicine. Cross posted from the Health Care Renewal website

We have posted about the plight of the corporate physician.  In the US, home of the most commercialized health care system among developed countries, physicians increasingly practice as employees of large organizations, usually hospitals and hospital systems, sometimes for-profit.  The leaders of such systems meanwhile are now often generic managers, people trained as managers without specific training or experience in medicine or health care, and “managerialists” who apply generic management theory and dogma to medicine and health care just as it might be applied to building widgets or selling soap.

We have also frequently posted about what we have called generic management, the manager’s coup d’etat, and mission-hostile management. 
Managerialism wraps these concepts up into a single package.  The idea is that all organizations, including health care organizations, ought to be run people with generic management training and background, not necessarily by people with specific backgrounds or training in the organizations’ areas of operation.  Thus, for example, hospitals ought to be run by MBAs, not doctors, nurses, or public health experts

Furthermore, all organizations ought to be run according to the same basic principles of business management. These principles in turn ought to be based on current neoliberal dogma, with the prime directive that short-term revenue is the primary goal.

Now there are a few signs that the physicians are getting fed up with having to answer to generic management and managerialism.

I found two stories, perhaps somewhat related, about physicians unionizing to stand up to their new often managerialist overseers.  The most prominent was in the New York Times on January 9, 2016, provocatively titled “Doctors Unionize to Resist the Medical Machine.”  It tells the story of how the hospitalists at PeaceHealth Sacred Heart Medical Center in Springfield, Oregon, formed a union de novo.  The second started with a brief article in the Seattle Times on December 27, 2015, about how housestaff at the University of Washington (UW) revived a housestaff association and turned it into a union.

Managerialism as the Stimulus at PeaceHealth

The long article about PeaceHealth showed that managerialist leadership of the hospital system was the chief stimulus for unionization. 

Managerialist Tactics: Outsourcing

The NYT article opened with

in the spring of 2014, when the administration announced it would seek bids to outsource its 36 hospitalists, the hospital doctors who supervise patients’ care, to a management company that would become their employer.

The outsourcing of hospitalists became relatively common in the last decade, driven by a combination of factors. There is the obvious hunger for efficiency gains. But there is also growing pressure on hospitals to measure quality and keep people healthy after they are discharged. This can be a complicated data collection and management challenge that many hospitals, especially smaller ones, are not set up for and that some outsourcing companies excel in.

Outsourcing is a now familiar entry in the managerialists’ playbook.  It is seen more in manufacturing than in health care.  Although touted as improving economic “efficiency,” it also may reduce the accountability of the managers of the organization that does the outsourcing.

Pursuit of Economic Efficiency

In this case,

Outsourced hospitalists tend to make as much or more money than those that hospitals employ directly, typically in excess of $200,000 a year. But the catch is that their compensation is often tied more directly to the number of patients they see in a day — which the hospitalists at Sacred Heart worried could be as many as 18 or 20, versus the 15 that they and many other hospitalists contend should be the maximum.

It was the idea that they could end up seeing more patients that prompted outrage among the hospitalists at Sacred Heart, which has two facilities in the area, with a total of nearly 450 beds. ‘We’re doctors, we’re professionals,’ Dr. [Rajeev] Alexander said. ‘Giving me a bonus for seeing two more patients — I’m not sure I should be doing that. It’s not safe.’ (A hospital representative said patient safety was ‘inviolate.’)

A constant theme of managerialism, and the neoliberalism that underlies it, is economic efficiency.  The usual narrative is that efficiency means providing better goods and services at lower costs. Instead, managerialism and neliberalism may mean decontenting goods and services so as to lower costs to the organizations providing them, but not necessarily providing more value to consumers.  In health care terms, managerialism and neliberalism may lead to less accessible, more mediocre health care that increase revenue to the organizations providing it, as implied by the physicians’ comments above.  Making the US the most commercialized, managerialist run, and arguably neoliberal health care system among the developed countries has not led to lower costs, better access, or better health care
quality.

The backstory for the outsourcing emphasizes that managerialism, and the resulting economic efficiency was indeed the goal of PeaceHealth…

In 2012, Sacred Heart’s parent, PeaceHealth, a nonprofit health care system, installed an executive named John Hill to adapt its Oregon hospitals to the latest trends in health care. Mr. Hill, in an effort to rein in the budget and improve the efficiency of a hospital that administrators said was lagging in key respects, including how long the typical patient stayed, eventually concluded that the hospitalists at Sacred Heart should be outsourced.

Centralization of Control

Furthermore,

The hospitalists also chafe at the way the administration has tried to centralize decisions they used to make for themselves. This might include hiring fellow doctors or the order in which they see patients on any day. They also complain of being loaded down with administrative tasks.

‘We’re trained to be leaders, but they treat us like assembly line workers,’ said Dr. Brittany Ellison, a hospitalist in the group. ‘You need that time with the patient,…’

A major feature of managerialism is the concentration of power within (generic) management. To quote Komesaroff(1),

In the workplace, the authority of management is intensified, and behaviour that previously might have been regarded as bullying becomes accepted good practice. The autonomous discretion of the professional is undermined, and cuts in staff and increases in caseload occur without democratic consultation of staff.   Loyal long-term staff are dismissed and often humiliated, and rigorous monitoring of the performance of the remaining employees focuses on narrowly defined criteria relating to attainment of financial targets, efficiency and effectiveness.

We’re Only In It for the Money

Also, the negotiations that started once the PeaceHealth physicians formed their union demonstrated a central tenet of managerialism

Even starker than the divide over these questions are the differences in worldview represented on opposite sides of the table. During a bargaining session last fall, the administration proposed increasing the number of shifts a year. Hospitalists now earn about $223,000 a year for 173 shifts and are paid extra for working more. The hospital offered $260,000 for a mandatory 182 shifts, and up to $20,000 in bonus pay for hitting certain medical performance targets. The hospitalists work seven days on and seven days off, so this would have effectively eliminated any time off for sick days or vacation.

When the doctors pointed this out, the administration responded that if they missed a few days, it would make sure they got extra days to hit the required number of shifts for full pay.

The hospitalists assured the administration negotiators that their concern had nothing to do with money — that none of this had ever been about money. They preferred to work less and make less to avoid burnout, which was bad for them and worse for patients. At which point the administration responded that money was always the issue, according to several people in the room. (The hospital declined to comment.)

Suddenly it dawned on the doctors why they had failed to break through, Dr. Alexander said. ‘Imagine Mr. Burns,’ the cartoonishly evil capitalist from ‘The Simpsons,’ ‘sitting across the table,’ he said. ‘There’s no way we can say, ‘This isn’t what we’re talking about. We’re not trying to get the bonus.”

Again, managerialism is based on neoliberalism, and neoliberal view is that the market rules.  The market is the arbiter of success, and money is the only outcome that matters.  As Komesaroff put it(1),

The particular system of beliefs and practices defining the roles and powers of managers in our present context is what is referred to as managerialism. This is defined by two basic tenets: (i) that all social organisations must conform to a single structure; and (ii) that the sole regulatory principle is the market.

Mission-Hostile Management

Never mind that the centrality of money seems entirely inconsistent with the stated mission of PeaceHealth,

We carry on the healing mission of Jesus Christ by promoting personal and community health, relieving pain and suffering, and treating each person in a loving and caring way.

Ostensibly, this is accompanied by core values, such as,

Stewardship
We choose to serve the community and hold ourselves accountable to exercise ethical and responsible stewardship in the allocation and utilization of human, financial, and environmental resources.
and,

Social Justice
We build and evaluate the structures of our organization and those of society to promote the just distribution of health care resources. 

We have frequently discussed how leadership of contemporary health care organizations often seem to act contrary to the organizations’ stated mission, that is, mission-hostile management.

Value Extraction

Finally, while managerialism is ostensibly concerned with economic efficiency, whose efficiency matters.  When managers address physicians’ efficiency, they seem to look at amount of work done divided by the cost to the hospital of paying
physicians. However, they never seem to look at their own costs, the costs of management, as being a negative.

The PeaceHealth 2014 form 990, the latest available, states that the then CEO, Mr Alan Yordy (whose highest academic degree was an MBA, according to his LinkedIn page) had total compensation in 2013 of $1,366,742, and 11 other managers had total compensation greater than $250,000, with 9 having total compensation greater than $500,000. Those figures should be compared to the highest compensation offered the hospitalists, a maximum of $280,000 for 182 shifts a year, eliminating all vacation and sick leave. So if it is all about the money, the managers are making the most of it.

We have discussed ad nauseum the ridiculous compensation of the leaders of health care organization, even non-profit organizations.  Value extraction by top management has become a central feature of the US and global economy (look here).

The NYT article did not discuss whether the upset hospitalists knew about their bosses’ compensation.  I suspect they did.  

Forming a Functioning Union at the University of Washington

The media coverage of the UW housestaff unionization was less detailed.  It does appear, though, that a stimulus was the pursuit of economic efficiency by UW management through squeezing the pay of housestaff, as described in the December article in the Seattle Times. In it the house staff said,

they account for about one-fifth of King County’s doctors and they want higher pay, new child-care benefits and free parking. Some UW residents and fellows earn so little that they qualify for welfare programs like Temporary Assistance for Needy Families and the Seattle City Light Utility Discount Program, according to the UWHA [University of Washington Housestaff Association.]

Another article in early January, 2016 in the Seattle Times added,

The association has proposed that residents and fellows earn at least the same salary as the UW’s lowest-paid physician assistants. Because the doctors in training work very long hours, they sometimes earn less than Seattle’s minimum hourly wage, the UWHA has said.

The council members, in their letter to Cauce, called the situation shocking. And based on information from the UWHA, they wrote that some residents and fellows qualify for welfare programs like Temporary Assistance for Needy Families (TANF).

The Seattle articles noted that the UW housestaff may earn from just over $53,000 to just under $70,000 a year.  Keep in mind, however, that under current rules, house staff may work up to 80 hours a week.  So $53,000 for someone working those hours translates into $13.25/ hour, under what many people now claim is the living wage.  That could be considered exploitation of  workers with doctoral degrees working in often highly stressful situations where lives may be on the line.  Whether there were issues other than money (and the respect it implies) involved at UW was not apparent based on the minimal press coverage.

So it appeared that the hospitalist physicians working for PeaceHealth, and most likely the housestaff of the University of Washington were pushed to unionize to counteract the managerialism of their hospital leaders.

The Results of Unionization So Far

In my humble opinion, similar stories to those at the PeaceHealth hospital about managers pushing physicians to increase productivity and efficiency, seemingly with little regard for the effect that might have on patient care and physicians’ professionalism can be found at many hospitals and health systems.  Housestaff may be paid at little more than minimum wage rates at many training institutions.  However, employed physicians have rarely effectively resisted up to now. Perhaps one reason is that at many institutions, each employed physician has his or her own contract, and may feel little power to negotiate his or her working conditions independently.  Housestaff physicians obviously might feel they have even less leverage.  But at PeaceHealth Sacred Heart, the physicians had other ideas:

Amid the groaning, a relatively new member of the group named Dr. David Schwartz observed, ‘They can’t fire all of us — there are unions.’ This was a bit of a stretch: While there are hospitals around the country whose doctors are unionized, there did not appear to be a union anywhere composed of a single group of specialists. But Dr. Schwartz, a barrel-chested man with close-cropped hair and a bushy beard who would not look out of place at a graduate English seminar, thought unionizing might be worth a try.

At the time, it was only one of several options the doctors considered. They talked of forming an independent hospitalists group, of forming an alliance with an outsourcing firm of their choosing. But the alternatives gradually fell away for a variety of practical reasons, and the doctors were growing increasingly bitter.

Dr. Littell developed a riff, which the other hospitalists appropriated, about how the situation was like having your spouse of several decades announce he or she was going to play the field. ‘You’ve been great, you’ve always been there,’ he would joke. ‘I just heard there could be better spouses out there.’ The kicker: ‘The good news is, you’re in the running, too!’

Amazingly, the unionization at PeaceHealth Sacred Heart was at least partially successful,

By March 2015, the PeaceHealth leadership, whatever its interest in efficiency gains, was apparently not pleased that one of its hospitals had a white-collar labor insurrection on its hands. The company announced that it would not outsource the hospitalists, a move it later said was always a possibility. Mr. Hill, who declined to comment, left in May.

The union did defeat the outsourcing tactic.  But otherwise results have not been so quick to appear, 

Noting that the negotiations with the hospital administration have dragged on for roughly a year, Dr. Schwartz said, ‘It’s pretty obvious that they don’t want to get a contract done.’ He says the administration worries that if it essentially rewards the hospitalists with a contract, it encourages other hospital workers to unionize too.

The housestaff at UW used a slightly different set of tactics, but still managed to form a real union.  Per the earlier Seattle Times article,

Established in 1964, the UWHA was mostly dormant during the 1980s and 1990s, according to the association’s website. It became active again starting in 1999. In 2013, members proposed making it a state-recognized collective-bargaining unit.

The UW petitioned the state Public Employment Relations Commissionto block the move, arguing that the residents and fellows were students paid stipends rather than employees paid salaries. But the commission sided with the residents and fellows, who last year voted to unionize.

The housestaff association has succeeded in negotiating. But as did the PeaceHealth doctors, they have not yet been able to secure their positions, per the later article.

University of Washington brass say they’re committed to providing the UW’s medical residents and fellows with decent compensation and benefits, but they insist the newly unionized doctors in training are asking too much in contract negotiations.

So,

Talks have been stalled for some time but are set to resume this month with a mediator assigned by the state Public Employment Relations Commission.

The two sides ‘remain far apart in the area of compensation,’ Joyner wrote in his letter.

Parenthetically, unexplored in any of the press coverage is whether the parallels between what is going on at PeaceHealth and the University of Washington have to do with explicit ties between the organizations. In 2013, per Beckers’ Hospital Review, the news broke that the two institutions signed a letter of intent to create a “strategic alliance.” In 2014, an article in the Seattle Times noted the ongoing concerns of housestaff and students at UW that the alliance could be diminishing their educational opportunities.

Summary

In one sense, it is amazing that physicians are now starting to unionize as a response to the managerialism of their leaders.  It was not all that long ago when the majority of physicians worked as solo practitioners or in small group practices, and fiercely defended their autonomy.  The last thing they would have thought about was unionization.  Since physicians were their own bosses, with whom could their unions have negotiated?  In addition, in the US, independent physicians and physician practices could not legally unionize.  Practices that discussed such issues as fees were liable to anti-trust prosecution.  And with what bosses could they have conceivably negotiated.

Yet now physicians are increasingly corporate employees, hence corporate physicians. At the moment, unionizing may be one of the few effective tactics health care professionals can use to halt the march of managerialism/ generic management and partially relieve the plight of the corporate physician (and health care professional.) However, in the long run, as long as people who care more about money than about patients’ and the public’s health run health care, even unions will not be able to make that much progress, and not without adverse effects.

It would take true health care reform to address the larger problems with health care and society that is now leading to physicians unionizing.  In  my humble opinion, hospitals, health care systems, and other “provider organizations” should seek better patient care, not growth.  Should they not voluntarily downsize (an almost comical idea in the current context), anti-trust enforcement, and probably new legislation would be needed to stop their pursuit of market dominance and return them to responsible community organizations.  The now much smaller hospitals, and provider organizations should not be run for profit, and the commercial practice of medicine should again be illegal.  Most physicians should go back to being private practitioners as individuals or within small groups.  Leaders of hospitals and provider organizations should be accountable for putting patients’ and the public’s health first, upholding professional values, and should not expect to get rich doing so.  But I dream on….

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32 comments

  1. Keith

    The biggest problem with rent an MBA managers is that they don’t understand the business.

    Not understanding the business means they don’t know how to grow it through investment, they only really understand efficiency savings and cuts.

    With this mind set there is only one way to expand and that is trough mergers and acquisitions where they can take something that already works and then cut out or merge common areas where their expertise still comes into play.

    Expansion through cuts in existing businesses.

    The German engineering company is usually a family business where its leaders have lived and breathed that business for as long as they can remember. They know which areas are likely to yield growth and know where to invest for the future.

  2. Inverness

    Managerialism and deprofessionalization. It started in education in the US over a decade ago. I never thought it would happen in a highly respected field like medicine, where MBAs would take over positions that medical professionals once had. According to our era’s neoliberal dictates, the manager is king, and the professional is dead. The manager can do anything! Doctors and nurses are going to need the support of their patients (ie; us) in order to fight this beast.

    1. Gio Bruno

      I think it’s important to understand the term “hospitalist”. This term is for doctors (usually young, former interns) that practice solely within the hospital. Most, if not all, do not have separate private practices— yet. I don’t know whether private practitioners are soon to be unionized.

      In any case, this article is just another rationale for single payer insurance (and medicine for health sake, not big profits).

  3. Synoia

    Management get the Unions it dissevers. Management want to cut overhead, but not themselves, It appears the same factors are at play in higher education.

    Unions only succeed if ALL the members practice solidarity. As goes the famous (mis)quote, “Gentlemen, we must all hang together, or assuredly we will all hang separately.”

  4. flora

    Thanks for this article. Industrial time and motion studies to find more efficient production and better quality of widgets makes sense in industrial production. Applying time/motion industrial studies to the practice of medicine or education is a misapplication of industrial techniques; similar to misapplied metrics in corporate decision making you mentioned in earlier posts. Doctors and teachers are not assembly line workers turning out uniform widgets to sell. Patients and students are not widgets. Uniform production methodology does not work in medicine or education. It is not even capitalism. It is pure rent extraction from a captive population.

  5. KYC

    I don’t see how physician unions can be too effective. If they strike, it ultimately impacts patient care which is one of the things that are important to them. It’s similar for patients supporting physicians, it may come down to a choice of forgoing treatment to boycott management at the detriment to their own health.

    The long term solution has some parallels to local vs national politics. Physicians need to create their own pipeline of future business managers who can take control back from the MBAs. Choosing to focus narrowly on medicine is not really a viable option for the collective group. Eventually, when the differences in quality of care are obvious between physician-managed versus generic manager led providers (and potentially with better costs), patients will vote with their feet and wallets.

    1. guest

      Oh, they could be very effective — if they used the nuclear option.

      Some years ago, nurses in Finland got into difficult negotiations on the renewal of their collective agreement.

      The major point of dispute was wages. For years, many Finnish nurses preferred to emigrate to countries like Norway where they are far better paid, and where the working conditions are less stressful.

      The main nurses union announced that if health ministry and hospital administrations continued to refuse negotiating the nurses demands, they would resign en masse.

      As the deadline neared, panic struck hospital administrations and politicians, as the union appeared totally set to carry out its threat. There was even a last-ditch scramble to pass a law to force nurses to continue working after a resignation, a move which the union declared it would oppose in courts on constitutional grounds.

      In the last days, negotiations became frantic and the nurses got largely (albeit not everything) what they were asking for.

      There were similar movements in other countries (such as in Ireland and Canada), and the outcome of such actions has been analyzed.

      1. KYC

        Great examples! And yes, I can see that striking healthcare providers (physicians and/or nurses) en masse would frighten politicians. However, when I imagine how the business MBA would deal with this, it might just be to shut down the hospital/practice and move on to a different business altogether for their next rent-seeking gig. When it’s treated purely as a business decision, I fear that striking unions would always lose.

        The examples that were provided in the two responses above involve countries where there is government accountability for healthcare. In the US, who can the public get angry with when hospitals shut down? The CEOs are largely anonymous to the general public, and given the seemingly high salaries of many medical providers, propaganda stories can be planted in the media to villainize the unions (as is already done in other industries).

  6. Dave

    Yves wrote:

    “And the managers are all MBAs, so it is not as if the effort to routinize care is driven by people who in theory might have ideas about how to achieve better medical outcomes.”

    Chelsea Clinton Mezvinsky has an MBA in Healthcare.
    She is out campaigning for Mommie Dearest.

  7. TedWa

    Geez, I didn’t realize they were doing this to doctors and staff. Commoditization I mean. RE Appraisers were independent contractors whose industry was commoditized by Andrew Cuomo’s illegal HVCC and the logic used is that all appraisals and appraisers are the same. This logic is what caused inflated values and the meltdown but has now been made legal just as counterfeiting by the banks was made legal early in the 20th century through the Federal Reserve Act and fractional reserve banking (my understanding). Back to the neoliberal logic used here. All physicians are the same and do the same work with the same quality and talent so why not commoditize them by interjecting a management company in the process is the neolib thought process. That way they can get these “independent contractors” under control and by “managing” (getting rid of independent contractors) them at high fees. Appraisals now cost consumers about twice what independent appraisers would charge and that is to cover the management fees. But that isn’t enough, these management companies also skim the fees appraisers are paid. The same goes for these physicians it appears. I see their quandary as being independent was a respected attribute but respect and individuality and talent has no place in neoliberalism. Like appraisers it’s hard for them to organize to fight off these blood sucking leeches since they never had to before and most physicians (like appraisers) loved their independent status and lives and dislike this managerial structure being imposed on them with their fees being taken for their unnecessary “management”. Like UBER, they are probably subcontractors to these management companies so these MC’s don’t have to pay any employee benefits.
    I’m sure readers of NC all know this but I had to express my empathy for their plight. They could join the SEIU and/or the AMA, both Guilds. Truly independent contractors are done in this neoliberal age of vampire squids protected by neolibs and often illegal but made legal laws.

  8. perpetualWAR

    More and more I view the UW as a big evil. As seen in this case.

    Keep in mind, Foster School of Business at UW brought Jamie Dimon to Seattle as keynote speaker for their “Leadership Awards”. I now view UW as a scourge on the City of Seattle.

    1. gardener1

      The highest paid employees of the state of Washington are state university sports coaches, football and basketball, ringing in at millions per year. Value baby, value.

    2. Michael Fiorillo

      UW, with funding from the Gates Foundation, is also a vehicle for privatizing K-12 public education, via its Center For the Reinvention of Public Education.

      “Reinvention” translates from Newspeak into English as “Hostile Takeover Leading to Privatization.”

    3. Knute Rife

      They invited the man who destroyed Washington Mutual to keep Chase afloat to talk about leadership, yet everyone in the region keeps preaching that UDub is a world-class institution.

  9. Wade Riddick

    If outsourcing was what this was really about, the over-priced parasites managing American medicine would have been expelled long ago and cheap Cuban communists imported to run our system. Cuba keeps more people healthy for less money than almost any place on Earth. The ultimate irony of neoliberalism is that it’s getting outcompeted by people who don’t believe in capitalism. The employees with the most unjustifiable wage increases and worst relative productivity in medicine are, as Dr. Poses points out, the guys at the top.

    Neoliberalism is, of course, just another way of hiding managerial looting and fraud. It’s all about agent loss. These guys are just coming up with new excuses each year to confiscate more of the healthcare budget for themselves.

    None of these bonuses are measured by whether patients get healthier faster and at a lower cost – *to the patient*. What other important measure of efficiency should we consider?

    Profit.

    As Shkreli said, he’s in a “price-inelastic business” and that’s why he hiked prices the way he did. He could charge whatever he wanted because if patients didn’t pay, they died. We should have paid closer attention to that logic because it’s apropos here. This is only about how the patient is of use to the corporate bottom line.

    This patient is actually the product being manufactured. We are traded back and forth to health insurers, drug companies and others for reimbursement – not dissimilar to the way TV news serves up consumers as a dish to their true customers, their advertisers.

    All of the points Dr. Poses brings up are valid, but some clarification from economic theory here would be helpful. The healthcare business is not a business. It is a monopoly utility. When its profits are not properly regulated (as today) its prices quickly become extortionate.

    If a patient has diabetes, they require insulin. There isn’t any way around this unless you can replace the pancreatic beta cells (killed by autoantibodies in type I and innate cytokines in type II). How do you plan to ration care for that? There is, however, a way to jack up the price. Patent chemical variations on insulin and then take the public domain insulin off the market through collusion. This then divides up the captive market into a series of oligopolistic suppliers who face no competition from the real molecule and they can jack up prices just like they’ve been doing the last few years. Patients have no place to turn (and the pseudo-insulin probably isn’t so great for their health either).

    It’s the patients who need to unionize but like Mancur Olson observed in _The Logic of Collective Action_, some interests are easier to organize than others. Rounding up three cartels to agree on a common political cause is much easier than organizing millions of very sick and financially stressed people and asking them to give money to politicians or opening up a nonprofit coop that passes FDA scrutiny to make insulin.

    Relative organizational cost is a vitally important point to remember as we discuss physician unionization and the pending overthrow of a century of Supreme Court doctrine supporting collective bargaining.

    It’s a point that the lawyers in yesterday’s New York Times article, “Case Could Widen Free-Speech Gap Between Unions and Corporations,” don’t quite understand. It’s not just the shareholders of corporations who have their pockets picked when corporate management makes political donations. Shareholders of common stock are pretty low on the totem pole of interested parties in a bankruptcy. Ahead of their claims on the ownership of corporate assets come lenders, bondholders, customers and employees themselves (who after this recent court decision will probably have even less hope of unionizing than they do now).

    According to the court’s logic, shareholders can just sell if they don’t like the decisions of management. They’re also supposed to have the benefit of all this transparency in campaign finance that the delusional Justice Kennedy keeps assuming exists.

    What about customers – who have a higher claim on corporate assets than common stockholders? How are *customers* supposed to navigate a marketplace made up of opaque monopolies and then make a choice about where they want to take their money? How does a customer of a cartel have more choice and freedom when they’re overcharged for a service or good – especially if no other alternative is available to treat their illness? If everybody making insulin is stealing your money and charging you to buy off your politicians, how is this liberty? Maybe it’s good for the freedom of the guy picking your pocket, but not for you.

    This is the “freedom to contract” nonsense from Lochner all over again. Except it’ll get rich people like Scalia killed when they pop up in this inefficient, error-prone sickcare system too. Corruption of the body politic, like the body personal, is often communicable – a fact this court routinely ignores.

    Against this backdrop, doctors are going to unionize?

    Yeah, good luck with that.

    Expect to see more prescription writing authority migrate into the hands of bureaucratic tools.

    The system is set up this way because it’s the most efficient way of extracting political rents.

    P.S. These are not the only ways solo medical practice is threatened. For years regulators have been restricting the sale of compounded medication to doctors for in office use making things like simple compounded Avastin eye injections harder and more expensive to do. Large hospital chains and main pharma products are, not so inconspicuously, exempted from these regs. A thicket of obstacles are preventing solo practices from being cost effective and on the same level playing field as regional cartels. It’s occurring all up and down the supply chain.

    1. PQS

      “The ultimate irony of neoliberalism is that it’s getting outcompeted by people who don’t believe in capitalism.”

      Brilliant.

    2. Beans

      Excellent post, Wade Riddick.
      The healthcare industry has morphed into a jobs program. Not only does repairing it require the removal of the rentiers at the top, it will also result in the job losses of many who contribute to the maintenance of the status quo, but nothing to improving a patient’s health.

      1. Lambert Strether

        I don’t think there has to be job loss, net; after all, many of the positions now servicing insurance company billing systems could be repurposed for patient care — one of the cases where the neo-liberal “training” panacea would actually work!

        1. Beans

          Power is maintained by the healthcare rentiers by supplying the market with thousands of jobs – not by providing healthcare. Right or wrong, politicians fear massive job losses that would come if power and control of healthcare delivery was wrested from their hands and returned to individuals, healthcare providers and non-profits. Obamacare is a jobs program – more IT jobs to launch, sell, maintain and upgrade the EHR. More jobs for healthcare navigators and administrators. More jobs by ensuring that the market remain inefficient with multiple ACO’s run by multiple private insurance/ hospital groups instead of a single payer. More jobs for the medical device industry, medical real estate investors, medical building contractors, medical sales personel, etc. Obamacare masquerades as healthcare policy but it is an economic program that played a big role in “ending” the recession. That is why we now talk about consumers instead of patients.
          You are correct that jobs could be re-purposed – as long as people do something that provides them money on which to live, the problem with job losses goes away. But as long as big healthcare power brokers control the economic fate of tens of thousands of their employees, they control the healthcare marketplace.
          “the patient is the product being manufactured” – Wade Riddick – this sums it up nicely. The healthcare workers are the unrepresented factory workers of our current time.

        2. hunkerdown

          There’d be hours lost on net, no question about it. Medical billers wouldn’t be needed in every office (or maybe any office). Time wouldn’t need to be spent arguing with insurers, so medical case management would give way to something more like traveling nursing. Nobody would need to punch buttons on accounting packages poorly disguised as health care IT; maybe nobody or nearly nobody would need to write them, the billing organization having standardized on some government open source project like Ontario’s OSCAR. (Hopefully I’d be writing more patient-centered software myself.) And won’t someone think of the personal injury law firms? There really would be a lot less to do, as suggested by the 18% of GDP “health” currently represents.

          Then again, a BSN degree doesn’t automatically confer bedside manner, and that some nursing grads decided to install themselves in offices rather than wards might be small acts of mercy.

  10. jkl

    When did any of us make ‘informed’ choices about products. Beyond price and maybe utility, we all rely on the FDA/FTC to make sure the products don’t cause cancer or kill us. As a health care professional, my nutrition information is pretty limited, about on par with a dietician. The chemical and unnatural components are a mystery to me.

  11. Oregoncharles

    There’s a great irony here: Peacehealth/Sacred Heart, as the name implies, is a CATHOLIC hospital. Last I heard, its purpose was to support an order of nuns. No telling where the money goes now – but it’s going somewhere.

    On the one hand, that’s a problem for the cities it serves (Springfield and Eugene), because Catholic doctrine limits the services available at their main hospital. But the irony is, neoliberalism runs right counter to the supposed charitable purpose of Catholic hospitals – and indeed, against recent pronouncements of the Pope. It’s openly immoral.

    If I can find an email address, I think I’ll suggest to the hospitalists’ union that they go over the negotiators’ heads, using a MORAL argument. Might even manage to get the administrator fired – if they’re public about it.

    It’s bad that it’s Catholic, but just might give them leverage in this case.

  12. Malcolm MacLeod, MD

    I feel that I have read this article elsewhere in the recent past, and shall simply state that money
    and medicine make strange bedfellows. Medicine as a profession can and should be fun, and
    attempts to increase income are maladaptive. I has a ball in general pediatrics, but I retired in
    1996 and things were just starting to turn at that time with the advent of mediocre MBA’s. Today,
    I’m not certain that it’s worth it here, but it is in Europe. So far as working seven day shifts in a
    hospital, that’s just plain stupid.

  13. Ed Walker

    Note that there are no union contracts. That’s because the one thing that our managerial class has learned, is how to screw unions.

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