Hospital merger’s impact to be delayed

Bei Hu

University Hospital and Clinic employees have been assured at recent staff forums that, contrary to widespread rumors, life will not be much different for most of them on the first day of the hospital’s proposed integration with the Fairview Riverside Medical Center.
“They will probably come to the same location of work, and will probably do very similar, if not identical duties,” said Cheryl Streit of the joint University/Fairview Affiliation Human Resources Project Team.
Streit said the real changes will come when the organizational structure of the merged hospitals is changed. This process would probably not start until January, 1997.
The University Hospital and Clinic has taken in a declining number of patients in recent years, and it is part of the Academic Health Center, which has been experiencing financial difficulties. University officials say the merger is the only way to keep the cash-strapped hospital open.
The Human Resources Project Team is one of 12 groups formed jointly by the University and Fairview in February. These groups make recommendations to the negotiation teams putting the deal together.
Detailed negotiations, originally set to end May 1, aim to produce the definitive merger agreement. The ending date for the talks has been postponed because of the many complex issues involved.
Speaking at a recent public forum on the merger, University Senior Vice President of Finance and Operations Jo Anne Jackson said the two sides hope to hammer out the terms of the agreement by the end of June or early July. Approval from the University’s Board of Regents and Fairview’s Board of Governors is needed before the agreement is finalized and signed.
Jeanette Louden, head of the University’s Human Resources Project Team, said her staff have been holding weekly meetings with their Fairview counterparts since February. Meanwhile, they have been communicating with University Hospital and Clinic employees through focus groups, a telephone comment line, e-mail and the hospital’s newsletters.
Now, with the talks nearing conclusion, the team was able to give the first comprehensive presentation in months about the merger’s potential impact on employment. The presentations were given at staff meetings last week.
John Erickson of the University’s Human Resources Project Team said the current recommendations would apply to non-union workers transferring to Fairview. The issue of union representation in the new organization has yet to be resolved.
But the two sides have agreed that University Hospital and Clinic staff members will automatically become Fairview workers on the employee transfer date. Benefit changes will take effect on the same day and the new entity will have an integrated payroll system.
Employee transfer was scheduled to take place on Oct. 1, but has been postponed because of delays in the negotiations. University officials said a new timeline would be announced in the coming weeks.
According to the team’s recommendations, both part-time and full-time workers will be eligible for the benefits programs in the new organization.
A new paid time-off plan will be created for the merged system. University Hospital employees will be able to transfer their current paid time-off balances to the new plan.
Streit said employees would also join Fairview’s retirement plan — “a very good plan,” in comparison with other private companies’ plans. Meanwhile, a bill passed by the state Legislature in April allows employees moving to Fairview to retain their Minnesota State Retirement System pension credits earned while working for the University, a public employer.
Members of the team conceded that employees transferring to Fairview would have to contribute a bigger health insurance premium than they do at the University. The actual difference would depend on the specific plans selected, Streit said.
Streit said the Regents’ Scholarship program at the University Hospital and Clinic, which allows employees to take up to 10 credits of classes at the University for free each quarter, would be replaced by a tuition reimbursement program in the new organization. The new plan would reimburse 75 percent of the costs of tuition and books up to a maximum of $2,000 a year, as long as the employee takes job-related classes at an accredited institution.
Streit went on to say that program integration in the new organization would not happen until 1997 and might take more than 2 years to complete. Louden said staff size would be determined once the structure of the new organization is finalized. Fairview would then seek funds for training and retraining of dislocated workers.
Louden said the state Legislature has appropriated $1.8 million as transition funding for the merger. It will be matched by an additional $1.8 million from the University. The money would be used to ease the transition for both union and non-union workers. In the absence of union agreements, Louden said, only half of the money would be released on the transfer date.
The American Federation of State, County and Municipal Employees ended discussions about the merger with the University in April, when talks on priority hiring, severance pay and regents’ scholarships stalled. Ruth Bettendorf, president of AFSCME Local 1164, said the talks might resume in the next couple of weeks.
University negotiation with Teamsters has continued. The two unions together represent about 30 percent of University Hospital and Clinic workers, Louden said.
Union representatives said they were less than satisfied with what they have been told so far.
Bettendorf said, “We are never happy when workers are cut back, whether they are contract or non-contract.”
AFSCME demanded that severance pay be offered to all University Hospital and Clinic employees. The workers should be given the choice of whether or not to work for Fairview, Bettendorf said. She added that AFSCME would insist that workers’ seniority be recognized and that they be given hiring priority if they decided to leave Fairview and seek employment at the University. She also said AFSCME would continue to represent the workers in the new organization, even if it was not recognized by Fairview.