Magazine article Drug Topics

Nursing Home Chain and Union in Fight over Contract

Magazine article Drug Topics

Nursing Home Chain and Union in Fight over Contract

Article excerpt

Beverly Enterprises, reported to be the largest nursing home operator in the nation, and the Service Employees International Union (SEIU), which claims to represent more nursing home employees than any other union in the country, are at loggerheads over contract negotiations in Pennsylvania.

SEIU has been vying for public support by attacking Beverly over pharmacy pricing, quality of care, and freedom-of-choice issues. The nursing home company has fought back by charging union bias.

The dispute stems from contract negotiations in Pennsylvania, where SEIU employees have been working without a contract for about a year. In late 1996, the union created a group called the Family & Advocates Network (FAN) to air its side of the story.

Citing what a 1995 Consumer Reports article called "price gouging" on prescription drugs and other pharmacy products by a Beverly-owned nursing home in California, FAN conducted its own price comparisons.

The result, said FAN spokesman Arvid Muller in Washington, D.C., were price differentials of up to 407% between local retail drugstore prices and the prices Beverly Enterprises-owned homes charged patients through its pharmacy subsidiary, Pharmacy Corporation of America (PCA). The FAN survey covered specific drug products from such locations as California, Florida, and Pennsylvania, Muller said.

FAN launched a national publicity campaign to publicize its pricing charges. Paid radio ads invited listeners to call a toll-free telephone number for more information.

The union claims its campaign is designed to inform patients that they have a right, under federal law, to buy drugs outside the nursing home-a fact that many residents are not aware of. "We're trying to let patients and their caregivers know they can choose their own pharmacy," Muller said.

PCA had a different view of the union's publicity campaign. "For the past several years," wrote PCA communications director Laura Holloway, "PCA's parent company, Beverly Enterprises, has been the target of ... attacks by the SEIU, a union seeking to organize their facilities." The union hopes that these tactics "will help them at the bargaining table," she added.

On the issue of price, Holloway disputed the union's allegations of inflated charges. PCA operates in many markets where "third-party payers give close scrutiny to prices," she pointed out. "We therefore have to be highly skeptical about any allegation that our prices are not justified by the level of our services."

A number of independent pharmacists have called the union's toll-free line following its campaign. The callers included several Midwest pharmacy owners. …

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