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Labor Union Members Hold Informational Demonstration About "Nonprofit" Hospital That Netted Nearly $500 Million in Profits Last Year

Local members of a Portland, Oregon area SEIU, who comprise hospital workers and other service employees, recently held an informational demonstration to educate the public about a local Portland, Oregon area hospital that grossed nearly $500 million in profits last year, yet is legally classified as a "nonprofit" organization under tax law. The labor union members were urging the hospital to lower it's excessive fees to patients and behave more like what one expect of a legitimate "nonprofit" organization.

Hospitals that classify themselves as "nonprofit" organizations have been notorious for having some of the worst fee inflation of any businesses sectors in the American economy for many years in a row while some segments of the economy such as the electronic industry has actually reduced many prices by significant amounts since even the 1970's despite inflation in raw goods, etc.

One famous example of the outrageous fees that many "nonprofit" hospitals charge is $8-12 for just two aspirins to patients, while the same patient could buy an entire large bottle at any Safeway store for less than $1. A one dollar bottle of aspirin can net a "nonprofit" hospital as much as $600 or more. Any many more examples of these type of outrageous fees charged by hospitals that hide behind a "nonprofit" status to evade taxes exist.

Hospitals like to justify their "nonprofit" status by claiming that they pour the money back into research, etc., however not all hospitals have research departments, and much of this research may be paid for by government grants or tapping donors for cash,etc.

The SEIU educational demonstration raised some important issues. The cost of medical care continues to skyrocket far beyond the inflation rates of other parts of the economy, and medicine is one of the most profitable industries out there, with massive Director and CEO salaries reaching into the heavens. Not your father's concept of a "nonprofit" organization?


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Comments (7)

BPG:

Show me a hospital that isn't trying to make a profit...I bet you can't do it.

Judging by bills I pay them these days, they're doing just fine.

codekeyguy:

Hooson,
That's it. You are so in the tank for unions that you will find ANYTHING to say against ANYONE OR ANYTHING that makes a union "look good". You are so in the tank for unions it is disgusting.
FYI, "non-profit" means that no individual can benefit from the positive cash flow. This positive cash flow (profit, for the uninformed) MUST BE PLOWED BACK INTO THE INSTITUTION. I'm sure the hospotal has upgraded services, training, faciities, etc.
Also, when have you seen "custodial services", "clerical services", "staff training", "maintenance", "laundry and dry cleaning" on a bill you received from a hospital? Guess what, Hooson, Hospitals have charges like these, and must incur these expenses in order to provide any services to patients. I wonder who pays these costs? Could it be the "obscene profits" charged by non-profits? Take a course in non-profit accounting before you start spouting your uninformed commentary.

epador:

Since we need a little more information to understand how evil the Legacy system is compared to other Portland systems, could you provide the following information:

Statistics on the amount of charity care offered by Legacy System versus Provident and OHSU?

Statistics on salaries for CEO of Provident and OHSU systems?

Statistics on charges for ASA at Provident and OHSU systems?

Mention current status of relations of the Union with all three systems (a possible explanation for them singling out Legacy system for their attacks)?

Absent above information, this diatribe is a piece of Union Propaganda.

Epador, I always welcome your comments and I greatly admire your service as a doctor. You certainly have access to some facts that I do not on how the health care system really works.

My only intent here was to raise a debate brought up by some SEIU employees that nonprofit hospitals should offer better rates to those who require their services because the profit margin is so vast with hospitals.

It's funny how even dollar stores can make enough of a profit to stay in business buying wholesale items for 50cents and retailing them for a dollar, but hospitals need to pay 50cents wholesale for a $1 bottle of aspirin that they resell for about $600 and still claim to be nonprofit.

I think issues like this make for a good discussion point myself.

Lee Ward[TypeKey Profile Page]:

Non-profit hospitals and health care systems could lead the way in reducing health care costs for all Americans. Here in Northern California Kaiser Permanente has done just that, offering lower premiums and plowing money into new facilities.

They've modernized with a sophisticated computer system -- as you sit in an exam room talking to your doctor he or she is sitting at a computer terminal busily typing away - and that information is available to any Kaiser facility instantly, including pharmacies, labs etc.

Everything is large-scale, which reduces per-patient costs. Kaiser offers the lowest premiums of any of the providers in this area, and the bonus of kower co-pays, better prescription plans, etc.

Other non-profit hospitals are content to sit on their positive cash flow and plow it back into executive perks, nice furniture for their offices, etc at the same time they tighten the screws to their rank and file union employees. It's a mentality that just plain sucks, and from reading Paul's post I imagine that's the case in this instance.

At Kaiser, their efforts at employee satisfaction directly effects the level of customer service you receive. It's the opposite of the model wing nuts promote in their efforts to yell down expanded health care for Americans. It isn't some gumminit-run system of decrepit care managed by decrepit employees, and instead is a model for a non-profit run health care that can be provided at a lower cost than traditional health care.

Done on an even larger scale, it would help keep a lid on rising health care costs, putting pressure on other providers and insurers to also reduce costs to stay competitive.

I think -- whoever is elected in November - they will have to do something to fix the health care system in the US and to make coverage available and affordable for all Americans. It's a disgrace that the current administration did not pick up the flag dropped by the Clinton administration, and get health care for all Americans.

Clinton failed, but Bush didn't even try. That's a a national disgrace.

Lee Ward[TypeKey Profile Page]:

Kaiser is unionized, and it works to everyone's benefit. Happy employees are more productive and efficient, and unions give employees a say in their employment.

Lee Ward:

Here's an example that touches on both unions and the price of high health care costs... link.

The workers' contract expired in February and their union says Disney's latest proposal makes health care unaffordable for hundreds of employees and creates an unfair two-tier wage system. The union also says Disney wants to create a new category of part-time employees who would receive greatly reduced benefits.

Two sides in opposition because of high health care costs... and without a union these working Americans would be sunk.


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Publisher: Kevin Aylward

Editors: Lee Ward, Larkin, Paul S Hooson, and Steve Crickmore

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