California wants to increase workers’ access to health insurance – Chevron workers have testified this spring that they revoked the health coverage of hundreds of members of United Steelworkers Local 5 at Richmond, California’s refinery, during a strike that lasted for two months.
In April, thousands of nurses from Stanford Health Care were warned that they would lose their insurance if the strike continued for more than a week. After striking in mid-July, Sequoia Hospital in Redwood City was hit with a similar message.
In a labor dispute, it is common to freeze workers’ health insurance benefits. Without them, workers may be less likely to agree to management’s demands. California legislators are giving the edge to strikers.
Jim Wood, a Democrat in the Assembly, hopes that a new California law he authored, will discourage employers from cutting off benefits during labor disputes. This allows private-industry workers and their families to maximize state subsidies for Covered California coverage. Covered California is the state’s insurance marketplace. The California Labor Federation, California Teamsters Public Affairs Council and the Los Angeles County Federation of Labor sponsored the bill. It will take effect July 1.
Wood stated that the legislation’s goal is to tell people “No, you can’t do that.” “Never do it again.”
Kelly Green, spokesperson for Covered California, stated that eligible workers will be covered just like if they had incomes at the Medicaid eligibility level.
The worker’s federal subsidy would be taken into account by the state and the difference would be covered by the state. A single worker earning $54,360 per year could pay 8.5%, or $385 per month, for premiums under a mid-tier health plan. The new law for striking workers would allow the person choosing the same plan to pay no premiums, as if they made $20,385 per year, for the duration of the strike.
Under the American Rescue Plan Act, the federal government approved an increased subsidy. Under the Inflation Reduction Act, the enhanced subsidy will be continued through 2025. After the federal boost, the state’s share could rise.
According to one estimate, the law would cost California $341 per month on average for each worker. Strikes could last up to two months. According to labor groups, the bill will only affect 5,000 workers per year. California is home to nearly 15 million private sector workers. Strikes are usually a last resort in labor negotiations.
It is unclear how businesses will respond. Chevron, Stanford Health Care and Sequoia’s operator, Dignity Health did not respond to our requests for comment. Businesses and taxpayer groups did not object to the bill. California’s subsidy payments are covered by a combination of state and federal funds, which is part of the Affordable Healthcare Act. Businesses don’t have to pay any direct costs.
Last year, Gov. Gavin Newsom, a Democrat, signed the Public Employee Health Protection Act. This law prohibits public employers from ending health coverage during a strike. The new law for private industry is not like the previous one. There is no financial penalty or ban on revoking health benefits during strikes.
Nationally, both the Senate and House Democrats have supported an outright ban on this practice. However, neither bill has been advanced from committee.
California workers who lose their employer-sponsored benefits may be eligible for Medicaid, also known as Medi-Cal. They could also be eligible to purchase Covered California health insurance. Workers could be eligible for subsidies to help with their monthly premiums. The subsidy is generally larger for households with lower incomes.
Proponents stated that even if workers are eligible for Covered California insurance, this can make their coverage more expensive than what they have through their jobs. It can sometimes consume 30% to 40% of their income. Striking workers could experience delays as coverage may not be in effect until the next month.
“This is one of many drawbacks of having a healthcare system that is tied with employment,” stated Laurel Lucia (UCBerkeley Labor Center) about health care program director. “We saw that people were unable to get job-based coverage during the pandemic.
The Striking Sequoia workers reached an arrangement with Dignity Health. They returned to the 208-bed facility on Aug. 1 before their health coverage was cut. However, some claimed they could have stayed longer on the picket lines if they didn’t fear losing their benefits.
Mele Rosiles was a certified nursing assistant who was also a member of the union’s bargaining committee. She was pregnant at that time. “The threat from our employer to remove our family’s insurance was felt by a majority of our workers,” he said.
The California Association of Health Plans expressed concern about an earlier version of the bill, which sought to create a category of striking workers. However, the industry group dropped their opposition after it was established that Covered California could manage the change without it.
Covered California estimates that it will spend approximately $1.4 million to launch the benefit. Agency said that it will ask applicants to screen eligible workers and remind them not to cancel coverage if they return to work.