Senate Passes $25 Minimum Wage For Health Care Workers. What Will It Mean For Hospitals?

Lawmakers in the California Senate advanced a bill Wednesday that would raise the minimum wage for health care workers and support staffers to $25 an hour.

The union-supported bill, introduced by Los Angeles Democratic Sen. Maria Elena Durazo, would require any “covered health care facility” to pay the new minimum wage to all workers on their premises, regardless of employer. In addition to nurses and caregivers, eligible employees include janitors, food service staff, housekeepers and even gift shop employees, so long as they directly or indirectly support patient care.

Senators initially debated the bill for over an hour before coming up three votes short on the first attempt. By evening, they sent the bill to the Assembly with the bare minimum of 21 votes.

“I can’t fix all of the problems in our health care system with one bill,” Durazo said in an interview with The Bee after the initial vote. “That was not the purpose. The purpose was to elevate the role of the workers who provide us these services.”

The bill that passed the senate differed significantly from its original version.

An earlier amendment to the bill created a two-year phase-in for the increase, rather than a sudden jump. Wages would rise to $24 an hour by June 1, 2024 and reach $25 by June 1, 2025. The amendment also lowered the minimum for salaried workers, who would be paid no less than one-and-a-half times the health care minimum wage instead of two times.

Bill analyses so far have not identified a final estimate of how much costs would increase under the new minimum wage. Analysts acknowledged that raising workers’ income would decrease the number of people relying on state social service programs such as cash aid and Medi-Cal. But the state would also be on the hook for paying higher wages to employees and publicly funded hospitals and facilities.

An analysis commissioned by the coalition that opposes the bill estimates the increase in labor costs would total close to $8 billion each year across the public and private sectors.

During initial debate, Republicans and Democrats voiced uneasiness about how the bill might affect financially distressed hospitals.

“Sometimes our generosity and compassion exceeds our ability to pay and serve,” said Republican Sen. Kelly Seyarto, of Murrieta, after he voted no on the measure. “What has to be done first is you have to address the financial stability of the hospital health care system.”

Sen. Dave Min, D-Irvine, initially said he was concerned that a blanket wage increase for the entire state might not be the best solution for each county. Although he acknowledged that Durazo had worked hard to make the bill better, Min said he was unsure of how he would vote when he spoke to address the full Senate.

“I worry about this bill in a lot of ways,” he said. “I have deep concerns that this bill may end up causing health care facilities to exit the state, to go out of business, at a time when we really need them.”

Min eventually voted in favor of the bill.

Supporters of the proposal, backed by the Service Employees International Union California, applauded the Senate’s vote Wednesday.

“I’m glad that the State Senate listened to health care workers like me and heard the truth about how we are exhausted and burned out, how short staffing means we are doing double and triple work, and how our patients are left waiting to get the care they need,” said Mirell Vong, a patient registration representative at Mercy Hospital of Folsom, in a statement provided by SEIU California. “I’m glad they weren’t fooled by hospital industry lobbyists who claim they don’t have the money to pay us better.”

The measure’s opponents, who include hospital groups and long-term care agencies, expressed dismay and vowed to stop the bill in the Assembly.

“We’re disappointed in today’s vote,” said Jeannee Parker Martin, president and CEO of aging advocacy group LeadingAge California, in a statement Wednesday night. “Unless this bill is defeated, providers who care for the state’s most vulnerable will face severe reductions in services and closures — hurting California’s growing older adult population.”

The bill moves to the Assembly and, if passed, will return to the Senate for final approval.


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