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Allina responds to nurse's union claims that contract is unfair: CEO Ty Erickson says benefit changes are fair, sustainable

CEO Ty Erickson says benefit changes are fair, sustainable

Union negotiators at Regina Hospital have been stuck in negotiations with Allina Health over a new contract for nurses. The nurses took their case public this month with the assertion that Allina, which purchased Regina Hospital this past fall, is refusing nurses the fair contract it offers nurses at other Allina locations.

CEO Ty Erickson responded Thursday afternoon with a letter to Regina staff members, in which he stated that the claims union negotiators made – that the proposed contract changes are unfair and would affect the care Regina provides – are untrue.

“The offer we have made includes across the board wage increases of 2 percent in year one, plus an additional 1.5 percent increase in year two, plus an additional 1 percent increase in year three, resulting in a total guaranteed wage increase of 4.5 percent over the life of the three-year contract,” Erickson wrote. “This is in addition to the step increases for which our nurses are already eligible. This wage increase proposal is exactly the same as the one that went into effect on June 1, 2013, at Allina Health’s metro hospitals.

“In addition, we are proposing to offer our nurses health insurance plans that provide more choices, better benefits and lower costs than the plans they have today. The plans we are offering our nurses are the same plans that are available to all other Allina Health employees, including Regina non-nurse employees.

“Finally, we are also proposing to move our nurses, along with all Regina Medical Center employees, into the Allina Health 401(k) plan. This plan includes not only an employer match of up to 2 percent of salary every pay period, but also an additional automatic year-end employer contribution of 3 to 4.5 percent of annual salary, depending on length of service. Our current retirement plan has no automatic annual employer contribution.

“While I wouldn’t ordinarily share with all of you this level of detail on our union contract offers, I think it’s important to set the record straight in the face of aggressive union tactics to distort our offer and divide our workforce.

“I believe the employees at Regina Medical Center are the most talented, hard-working and compassionate group of caregivers I’ve ever worked with. This includes our nurses. There is no question in my mind that without you, Regina Medical Center would not be the outstanding community asset we have been for many years. That’s why I can state without reservation that the benefit changes we are making for all employees, as well as our proposal to the nurses union, are fair, economically sustainable and will enable us to continue to provide excellent care for this community far into the future.

“Much has been made of the supposed ‘deep pockets’ of Allina Health. I can tell you that the profound changes we are seeing in the health care industry are putting enormous financial pressures on organizations as large as Allina Health as well as on community hospitals like our own. While affiliating with Allina Health provides us with many opportunities to enhance the care we provide, it does not mean we can ignore the financial realities of declining reimbursement, national health care cost trends that are unsustainable, and the shift away from fee for service toward pay for performance,” Erickson wrote. “These forces require us to work hard to be good stewards of our resources and to operate as efficiently as possible. As you know, Regina Medical Center has struggled financially in recent times. Now more than ever we must make sure our cost structure makes sense and helps to ensure our future vitality.

“While our number one priority remains reaching an agreement that is in the best interests of Regina Medical Center, our employees and the communities we serve, we must also prepare for potential strikes or picketing the union could choose to engage in after the contract expiration date. Our commitment to our community is that Regina Medical Center will remain open and operational during any labor action, and we are actively engaging our Allina Health resources to ensure we are prepared.  Let’s hope it doesn’t come to that. I know that the vast majority of our nurses want only to provide excellent care to our patients. That’s what we all want. It’s in our DNA as health care professionals. I firmly believe that we can find common ground with the union and we can return our focus 100 percent to serving our patients and community.”

The current nurses’ union contract expires Dec. 31. Representatives from the union have told the Star Gazette they intend to keep working even if the contract isn’t settled before the deadline, and that they have options available to encourage Allina to offer a more satisfactory contract.