Internal Bleeding

St. John's Mercy Medical Center alienated their RNs when they turned to less experienced caregivers to save money. Now they're paying for it.

In 1994, right before the big reorganization of care, St. John's Mercy Medical Center (including a hospital in Washington, Mo., and other profit centers) reported $330.4 million in revenue. The next year, St. John's president was asked to resign and was replaced by Weber, a business-focused administrator who'd cut his teeth at Barnes Hospital. Then St. John's merged into the Unity Health System, now one of the region's four major systems, second only to BJC Health System in size and profitability. Unity is sponsored by the Sisters of Mercy Health System-St. Louis, itself the 14th-largest nonprofit health system in the U.S. "Mercy values" are still intended to rule -- although in March, the Sisters of Mercy ceded control of the system's day-to-day operations to laymen.

For the fiscal year ending June 1997 (the most recent data available), St. John's Mercy Medical Center reported revenues of almost $347.5 million and "excess" of $21.6 million. This December, when that Top 100 Hospitals award was announced, an article in Modern Healthcare characterized the winners as hospitals that "were able to do more with less. Compared with all U.S. hospitals, they employed 18 percent fewer staff members per 100 adjusted patient admissions, their occupancy rates were 22 percent higher, and they were 38 percent more profitable." St. John's made the list, the article reported, because of decreased lengths of stay and decreased expenses per discharge. "Profitability also outpaced the benchmarks: a cash-flow margin of 21.6 percent for the medical center vs. the 15.6 percent benchmark."

Obviously managed care was a challenge.
But maybe they overreacted.

St. John's recent management decisions aren't uniquely awful, they're typical. Nurses just aren't prepared to accept the new, numbers-driven version of patient care as inevitable. The general estimate is that 15-17 percent of the nation's RNs are already unionized, and campaigns are springing up in every major city, with about a dozen major unions competing for their business. But here in St. Louis, the St. John's nurses -- if they succeed -- will be the first to unionize. And if the St. John's nurses do organize, other health-care workers at the hospital -- and nurses at other hospitals -- are hoping for "a domino effect."

"St. Louis is one of the top 10 or 15 health-care markets in the country; it's right up there in terms of the pace and scope of change," notes Richard Sanders, national director of organizing for the American Nurses Association. "The nurses have been responding to it on their own for a long time." Now about a dozen major unions are competing for nurses' business. Sanders pauses, then says delicately, "Depending on the outcome at St. John's, we would be eager to start working with their nurses again."

The general public doesn't care which union the nurses choose -- we just want to know whether they'll strike. "The chances of that ever happening are pretty slim," says pro-union Lisa Nesler, a part-time RN in neurosurgery, "but when there is a health-care strike, it's not like there's a work stoppage. You cross the picket line. They scale things down, eliminate elective surgeries but still do traumas. It's not like nurses walk off the job and shut the doors."

Sanders says there's one strike per 100 negotiated contracts, so there's about a 1 percent chance of a strike. "I can't say there is no risk. But federal labor law governing health care is different than other industries because of the delicate, critical nature of the job. You have to give 10 days' notice before you can even do an informational picket, and federal mediators have to be involved."

The first attempt to organize at St. John's came back in 1984, when a group of nurses banded together for mutual support. "Management got so threatened, they gave everybody a 13 percent raise we didn't ask for," recalls Kathrine Metze Geldbach, a longtime psychiatric nurse. "Then they crucified the leaders. And we weren't even trying for collective bargaining!"

In 1996, spurred by the staffing changes of patient-focused care, the nurses did ask the Missouri Nurses Association (MONA) to help them unionize. The hospital promptly hired Industrial Relations Inc. (IRI) of Detroit, popularly known as a union-busting firm. Asked how much this counter-campaign cost (it's usually a pretty penny), St. John's PR manager Bill McShane says it was not a campaign. "IRI was brought in to educate management and employees about union organizing," he explains. "Financial arrangements are considered proprietary information."

IRI's visible tactics were innocuous: "They organized focus groups for employees to come in and talk," says Geldbach, "You were told it was to get your suggestions, but really it was to get a line on who might be pro-union." (At Warren Schools Credit Union in Detroit, IRI focus groups unearthed the invaluable information that employees didn't like the lighting in the parking lot.)

Geldbach fell for the focus-group shtick herself. Of course, she was tired: "They gave me a triple assignment. I was in charge of patients in full leather restraints, six suicidal borderlines who run around slicing at their wrists with plastic silverware, and patients who couldn't breathe after shock treatment. And in the middle, my boss would say, 'Metze, get your ass in here.' They ambushed people when they were harried: 'Get your things; we will be leaving the floor.' You thought you'd been fired, and it would be some silly meeting or other. They just wanted to keep us jumpy. And they did."

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