Multinational Monitor

OCT 2004
VOL 25 No. 10


A People's Health System: Venezuela Works to Bring Healthcare to the Excluded
by Peter Maybarduke

Managed Care Goes Global: Latin America Confronts the Multinational Health Insurers
by Celia Iriart, Howard Waitzkin and Emerson Merhy


Nursing Power: California Nurses’ Collective Advocacy for Patients and Nurses
an interview with Rose Ann DeMoro

Physicians Rx For An Ailing Healthcare System
an interview with Claudia Fegan

NHS, Inc: The Accelerating Marketization of the UK's National Health Service
an interview with Allyson Pollock


Behind the Lines

The Right to Healthcare

The Front
Justice DeLay'd - Flu Profiteers

The Lawrence Summers Memorial Award

Names In the News


Nursing Power: California Nurses' Collective Advocacy for Patients and Nurses

An interview with Rose Ann DeMoro

Rose Ann DeMoro is executive director of the California Nurses Association, the largest and fastest-growing professional association and union for registered nurses in the country. CNA membership has doubled in the past seven years. CNA today represents over 57,000 RNs in 164 facilities across California. With CNA, California nurses have led the nation in ground-breaking patient advocacy legislation such as staffing ratios and whistle-blower protections. Modern Healthcare, an industry trade publication, in 2004 ranked DeMoro the thirty-fifth most powerful person in healthcare in the United States.

Multinational Monitor: What proportion of nurses is organized in California or nationally?

Rose Ann DeMoro: About 20 percent of hospital-based registered nurses are organized nationally. In California, I believe that number is closer to 60 percent.

MM: What changes for a nurse if they are a member of a union? DeMoro: For one thing, they have the ability to engage in what we call collective patient advocacy, which is the ability to advocate for patients against hospital management collectively, rather than one-on-one. Nurses who are organized have higher retention rates; they are better compensated; their pensions are better; their health benefits are better. This translates directly into the quality of patient care, because an experienced RN workforce is going to provide better care.

Directly through their collective bargaining agreements, nurses are able to control nursing practice in their hospital. So the introduction of technology and other aspects of work arrangements that might undermine patient care are limited and prevented through the union contract.

MM: Is there a shortage of nurses in the United States?

DeMoro: Yes, primarily because of industry practices that have really undermined the ability of nurses to practice nursing the way they were educated and desire to practice.

It has made hospitals in particular a much less desirable place to work.

MM: Are the hospitals also cutting back on nursing levels?

DeMoro: In some cases, we are still seeing so-called hospital restructuring, which does substitute lesser skilled workers for registered nurses. We’re also seeing registered nurse-displacing technologies becoming the new wave of restructuring, which also reduces the number of RNs.

It is not like in the mid-1990s, when there were wholesale layoffs, but we are still seeing closures of hospital units, closure of hospitals and job-displacing technologies, as well as replacement by lesser skilled workers.

MM: How do these changes affect a nurse’s typical responsibilities?

DeMoro: In those 49 states that do not have nurse-to-patient ratios such as we have in California, nurses will have a very large patient load. They will have eight, 10, 12 patients that they have to care for. In an eight-hour day, this is very difficult. In the course of any day, there are a number of discharges and admissions — those are much more time consuming. Of course, the registered nurse is responsible for assessing and developing a nursing diagnosis and care plan for every patient they are responsible for. You can imagine when you have that kind of patient load, combined with the fact that patients are much sicker when they are in hospitals nowadays — there is higher acuity — then the workload for an RN in a typical day is overwhelming, unless there is some kind of nurse-to-patient ratio regulation.

MM: How does this impact care?

DeMoro: In California, it impacted care dramatically. There were higher rates of infection, and higher rates of re-admission, because patients who were discharged too early had to come back — patients who didn’t get the full care they needed in the hospital, couldn’t get the care at home. The ratio is really in response to that, those high number of patients that RNs had to care for.

Since the ratio has been adopted, we’ve not only seen more nurses in the hospital, but those nurses who are in the hospital really have the time to care for their patients.

MM: What is California’s staff ratio law?

DeMoro: The act mandating nurse-to-patient ratios was signed into law in October 1999. The regulations took about four years to implement, and went into effect in January 2004.

In medical-surgical units, the mandated nurse-patient ratio is one-to-six. That is going to go down to one-to-five in January. In the intensive care unit, we’ve had one-to-two since 1976. Most of the other units are gradated between them, one-to-three, or one-to-four.

In some units, these requirements cut in half nurses’ patient load.

MM: Are there enough nurses to fill all of these jobs?

DeMoro: Yes, there have been. There is still a demand for nurses, but at this point, probably two-thirds or more of the hospitals in California are in compliance, despite the ongoing campaign by some in the hospital industry to sabotage the law; those hospitals that want to comply have been able to find the RNs.

MM: Do you view what is going on in California as a model for the country?

DeMoro: Absolutely. Mandated staffing ratios are an integral element of attaining a single standard of care in this country. Otherwise, the care that patients receive is going to vary by hospital, community, state. We are not going to provide the level of care that nurses were educated to provide.

The model works, and California proves that.

MM: What has been the effect on cost?

DeMoro: The hospitals greatly exaggerated what the potential cost was. At this point, hospitals claim they are financially burdened by the ratio, but we haven’t seen any financial fallout from the ratios at this point. And for those in compliance, there is a tremendous financial benefit from lower RN turnover rates and reduced reliance on expensive temporary agencies.

MM: Do you see any difference in the treatment of nurses, or the care for patients, between for-profit and non-profit hospitals?

DeMoro: The for-profit hospitals in our experience were much more likely to have higher nurse-to-patient ratios before the regulations went into effect. It was in the for-profit sector that we were seeing the 10 and 12 patient ratios in medical-surgical units, more than the non-profit sector.

For-profit hospitals tend to have higher charge-to-cost ratios, meaning that they charge a much higher percentage of what their costs are. And we have also seen that the for-profit hospitals are more likely to engage in market consolidation.

But neither of those practices is limited to for-profit hospitals. You’ve got non-profit hospitals that have similar charge-to-cost ratios, and have engaged in closure of hospitals in order to gain market share. The fundamentals are not different; there are differences in degree.

MM: What is the explanation for the intense consolidation in the hospital sector, through mergers or network consolidation?

DeMoro: One way to look at it is you have the major financial stakeholders in the industry: for example, hospitals, the insurance companies, the pharmaceutical companies. There is in a sense a war among those major sectors in order to capture healthcare revenues, almost a majority of which comes from the government. In that war between those major sectors, each player has to improve their bargaining position, or leverage. The standard way to do that is through the merger-and-acquisition process; so that you achieve greater bargaining leverage with each other, if you have more people on your side.

At the same time, in the economy as a whole, finance capital really emerged as a driving force. And, they received a lot of help from the U.S. Department of Justice and the Federal Trade Commission in 1994 through their issuance of policy statements that had the effect of greatly weakening the Sherman and Clayton Act protections against corporate healthcare attempts to monopolize strategic markets.

So there is a lot of interest from the financial sector to finance mergers and acquisitions, because of the fees and profits and debt load that those finance companies would benefit from.

I think that combination — of essentially a war among all, and the incentives within finance capital and the federal policy shift encouraging corporate healthcare mergers and acquisitions — created a merger and acquisition frenzy.

MM: Does the merger trend affect care?

DeMoro: It definitely affects access, because you do have closures.

And it definitely affects the amount of revenue available for patient care when you are servicing debt load. It has a direct impact on patient care, because hospitals burdened by debts do not have the revenues necessarily to keep and retain nurses, for example.

Generally, the corporatization of healthcare has created a health emergency. We are seeing decreasing quality of care, declining access to care, skyrocketing increases in costs, diminishing RN control over provision of care — and worsening public health. Manifestations and consequences of the corporatization of healthcare include the things we’ve been talking about: cuts in public health funding; nursing shortages; hospital closures; deteriorating terms and conditions of work, for RNs and other healthcare workers.

MM: How do you propose the United States should remedy these problems?

DeMoro: The key is healthcare reform that establishes a single standard of care. We need a single-payer system, but the global budget core of single payer is only part of a comprehensive reform. Fundamental reform must emphasize everyone’s right to the same quality of actual care: If it is good enough for a hotel worker, it is good enough for the governor.

We talk about nurse-led reform, and a single universal standard of care is the overriding principle for nurse-led reform. Care should consist of the best standard available consistent with the art and science of medical practice as determined by the effective exercise of professional judgment concerning best practices, applied to each individual situation, by licensed caregivers.

We need a single-payer plan that, among other measures, includes:

  • A single universal standard of care applied to all patients and a uniform benefits package for all;
  • Mandated and enforced safe caregiver staffing levels based on patient need;
  • Patient and caregiver safety standards placed on caregiver work redesign programs and use of computer-based technologies;
  • Public regulation of corporate healthcare investments and divestments, with patient-sensitive criteria given first priority in all corporate healthcare investment and/or divestment proposals; and
  • Expansion of the overall healthcare budget.

Done right, single payer will mean not just more access, but better care and more control for nurses. Single payer would increase RN and patient participation in the evaluation of all new workplace designs and technologies introduced. RNs’ voice will ensure that all new workplace designs increase the quality of care and that all new technologies are made available to all patients. With single payer, RNs would be able to ensure that innovations in clinical practice and technology benefit all patients in all places.

MM: What do you have in mind when you reference caregiver standards for work redesign and introduction of computer technologies?

DeMoro: The redesign of the caregiver work process is in effect a social technology. It should be subject to the same type of safety standards that would be employed for any other healthcare technology. Changes in the work process should be evaluated for their long- and short-term impact on patients, and on caregiver skills and their knowledge base. And there needs to be certification in advance of implementation of clinical work redesigns, to ensure they will be safe and beneficial.

The same holds for the introduction of computer-based technologies, which risk impeding effective use of professional judgment by licensed caregivers. Attempts to automate the caregiver work process is a technology that must be subjected to safety standards and certified safe before implementation. We have in mind all kinds of technologies that are deployed in the workforce, particularly “expert systems” making use of artificial intelligence-based algorithms that impact protocols, and diagnostic and prognostic decisions and procedures.

MM: How would the public exercise control over healthcare investments?

DeMoro: An administrative apparatus operating under a global budget would oversee all healthcare investment and disinvestment proposals, which would be evaluated in terms of their clinical efficacy for the patient population. All other evaluation would be of secondary concern. Areas of concern would include pharmaceuticals, capital investments/divestments, service investments, medical technology, mergers and acquisitions.

In such a context, community hospitals could exist along with private hospitals, as both would be funded by the same source. Hospitals and other providers, whether public or private, would be guaranteed payment and would not have to worry about how much insurance companies pay them. In fact, insurance companies would be eliminated altogether.

Community hospitals would no longer be victims of the war among the major financial stakeholders in the industry, and we would remove the incentive for a multi-tier medical system with the poorest and sickest patients being dumped on public hospitals and clinics.

MM: What is the role for nurses in advocating for a single-payer system?

DeMoro: Nurses are strategically located to advance single-payer — they are everywhere that patients are. Nurses are trained in the nursing process, which gives them the tools to analyze public policy. And nurses are leaders in hospitals.

When nurses are organized, they can use their collective strength not only to change patient care, but to change healthcare systems. And, at the end of the day, the only way to really effect changes in workplace practices is to have a voice in how the entire healthcare system is organized.


U.S. Health Maintenance Organizations (HMOs) nearly doubled their profits during 2003, earning $10.2 billion, an 86 percent increase over the $5.5 billion reported in 2002, according to Weiss Ratings, Inc., an independent financial analysis service.

Blue Cross Blue Shield plans, as a group, produced a $5.4 billion profit, which is a $2.1 billion, or 63 percent, increase compared to the $3.3 billion profit recorded in 2002. Of the 56 Blues plans, 51, or 91.1 percent, reported positive earnings in 2003.


Company Net Profit
2002 ($mil)
Net Profit
2003 ($mil)
($ mil)
Kaiser Foundation Family Health Plan* -117.5 995.5 1,113.1
Blue Cross Blue Shield Michigan 161.3 374.4 213.1
Group Health Cooperative -6.9 187.8 194.7
California Physicians Service 142.6 314.2 171.6
Aetna Health, Inc. -40.2 129.8 170.0

* Kaiser's increase in profits is a result of regulatory changes that required the company to consolidate its year-end financial statements for all entities owned.



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