Gov. is cutting it close. He signed a law last fall that phases in a $25 for California鈥檚 lowest-paid health care workers beginning June 1. Then, he said he wanted to delay it because of its potential to exacerbate the severe shortfall.
But two weeks before the deadline for employers to start paying more to their employees, many health workers are still waiting to hear whether they will in fact see a raise.
Some health workers remain hopeful. Others have already been notified by their employers of their upcoming raise or have already started to see increased pay.
When Newsom presented his latest budget proposal last week, the governor said negotiations around potential changes to the law, , are still taking place. He promised a deal between his administration, the Legislature and proponents of the law would be hashed out in the upcoming weeks.
鈥淭his budget will not be signed without that deal that we committed to being addressed,鈥� Newsom said. He usually signs a budget for the next fiscal year in late June.
Meanwhile the union that advocated for the health care pay increase has launched an advertising campaign that aims to hold Newsom to the law he signed.
One ad by Service Employees International Union-United Healthcare Workers West on the shows a dialysis worker named Alice and it reads, 鈥淭he dialysis care Alice provides is lifesaving. Yet, with caregivers at her facility starting out at only $18/hr, it鈥檚 no wonder there鈥檚 a short staffing crisis.
A $25/hr minimum wage for healthcare workers will help ensure patients get the care they need.鈥�
Nathan Selzer, communications director for SEIU-UHW, said his union posted the messages because, 鈥淥ur workers were concerned and remain concerned. What we saw in conversations earlier this year was folks really focusing only on money and only on dollars and cents, and not on what those dollars and cents are used for.鈥�
SEIU-UHW is an affiliate of SEIU California, which sponsored the law.
鈥淲e made a decision that we鈥檝e got to make sure we鈥檙e reminding people why this was made into law to begin with,鈥� he said.
Selzer said he is not directly involved in conversations with the governor鈥檚 office and legislators, but that confusion among many workers rings true. 鈥淲e鈥檝e heard June 1, we鈥檝e heard July 1. It remains to be seen what actually happens here,鈥� he said.
Deadline to postpone minimum wage hike
What exactly is holding up the negotiations is unclear. Lawmakers and Newsom would have to pass and sign legislation that would push back the start date within two weeks to delay it effectively.
Newsom said he wanted to postpone the wage increase when he released his initial budget proposal in January. He asked the Legislature for an annual 鈥渢rigger鈥� that would tie the minimum wage increases to the state鈥檚 budget outlook. His administration projects the state is facing a in 2024-25.
The state has estimated the minimum wage increase could cost the state around $4 billion a year. That鈥檚 because the state would have to pay for the wage increases for its own employees at state health facilities and because the state may be forced to increase what it reimburses facilities for services provided to patients on Medi-Cal, its insurance program for low-income people, as a way to partially cover the pay raises.
The UC Berkeley Labor Center estimates the cost to the state to be much lower. Total health spending in California would increase by about $2.7 billion because of the law, but the state would be responsible only for a fraction of that, according to the Labor Center鈥檚 analysis.
Laurel Lucia, director of the Health Care Program at the Labor Center, said that there is no requirement in the law that directs the state to raise to hospitals and clinics as a way to make up for the costs of higher wages, but the law could play a role in Medi-Cal rate negotiations.
鈥淲hen the rates were set for 2024, there was recognition in that there might need to be changes to those rates due to鈥� the minimum wage increase, Lucia said.
California hospitals, dialysis clinics raising pay
Absent any confirmed changes to the law, some employers and associations representing health employers say they are moving forward with the raises as scheduled.
鈥淎s far as we know, the minimum wage for health care workers will be going up as of June 1. We have no information that would indicate otherwise,鈥� Jan Emerson-Shea, a spokesperson for the California Hospitals Association, said in an email this week.
The California Kidney Care Alliance, a trade association representing dialysis providers and clinics, said members are following the wage requirements as laid out by the law. 鈥淚n fact, many providers have already increased wages well ahead of the requirements of the bill,鈥� Jaycob Bytel, a spokesperson for the alliance, said in a statement.
, employees are scheduled to receive from $18 to $23 an hour starting next month. That鈥檚 compared to the current statewide minimum wage of $16.
The wage hike will phase in over the years until workers reach $25 an hour.
Some health systems have already notified employees of the upcoming pay boost, including the University of California Health system. In , UC Health said it would be moving forward with their scheduled wage hike of $23 an hour 鈥渕eeting the most ambitious timeline鈥� of June 1.
Meanwhile, some hospitals have already raised wages because of competition in the labor market. As an independent hospital that serves a high rate of low-income Medi-Cal patients, the wage law requires Kaweah Health Medical Center in Visalia to raise wages starting at $18 an hour.
鈥淲e are already seeing competitive changes in the market that have forced us to implement pay increases now, so we have not waited for June 1st,鈥� Gary Herbst, chief executive of Kaweah Health, said in an email. 鈥淲e are exceeding the state required $18 to remain competitive, and to continue recruiting and retaining great employees.鈥�
Herbst said he rolled out increases beginning in February, and 鈥渨ill continue to evaluate it as time goes on.鈥� He expects the law to cost his hospital about $30 million a year.
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