Aaron J. Sojourner

David C. Grabowski

Min Chen

Robert J. Town

Trends in Unionizationof Nursing Homes

Unionization may have important implications for the delivery of nursing home care,

but little is known about this phenomenon. Since 1985, the proportion of nursing homeworkers covered by union contracts declined from 14.6% to 9.9%. The first national-

scale data on facility-level unionization reveals that unions are more common in nursinghomes with more residents, in hospital-based or chain-affiliated facilities, and infacilities serving a higher proportion of Medicaid patients. With new federal policy

proposals aimed at substantially lowering the cost of organizing workers, policymakerswill want to consider the potential impact of nursing home unionization on worker,

patient, and market outcomes.

Since the November 2008 election, the U.S.health policy sphere has focused its attentionon health care reform with the recent passageof the 2010 Patient Protection and AffordableCare Act. However, Congress is consideringanother set of reforms that has drawn lessattention but also could have a significantimpact on the health care industry. The pro-posed Employee Free Choice Act (EFCA)is the most significant labor legislation in60 years (Epstein 2009; Fletcher 2008).Although prospects for EFCA as a stand-alone bill are fading, legislative and adminis-trative attempts to adopt elements of thereform will continue (Mascaro and Mishak2010).

Reform proposals have three main ele-ments. First, ‘‘card check’’ provisions wouldenable the National Labor Relations Board

(NLRB) to certify a union whenever themajority of a unit’s workers sign unionauthorization cards. To achieve certificationunder the current law, a union must demon-strate majority support through an NLRB-administered election. Second, EFCA wouldincrease penalties for employer unfair laborpractices that interfere with employees’ rightsto organize. Currently, the only legal conse-quence for illegally firing union supporters ispotentially having to rehire them with backpay. Third, EFCA would require that bar-gaining for an initial contract eventually besettled by arbitration rather than allowingnegotiations to stall indefinitely.

Such reforms would meaningfully reducethe cost of organizing a workplace and likelylead more workers to unionize. Recognizingthe high stakes of these reforms, labor unions

Aaron J. Sojourner, Ph.D., is an assistant professor in the Department of Human Resources and Industrial Relations,Carlson School of Management, University of Minnesota. David C. Grabowski, Ph.D., is an associate professor in theDepartment of Health Care Policy, Harvard Medical School. Min Chen, Ph.D., is a clinical assistant professor in theCollege of Business Administration, Florida International University. Robert J. Town, Ph.D., is an associate professorand holder of the James A. Hamilton Professorship of Health Economics in the School of Public Health, University ofMinnesota, and a faculty associate at the National Bureau of Economic Research. Address correspondence to Dr. Chenat Florida International University, 11200 SW 8th St., RB 208A, Miami, FL 33199. Email: minchenchen@gmail.com

Inquiry 47: 331–342 (Winter 2010/2011). ’ 2010 Excellus Health Plan, Inc.ISSN 0046-9580 10.5034/inquiryjrnl_47.04.331

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have made this their top national politicalpriority and devoted tremendous resourcestowards their promotion. The U.S. Chamberof Commerce, American Health Care Asso-ciation, National Center for Assisted Living,and other employer lobbies have opposed theproposed reforms with similar vigor (LaPorte2009). These reforms would affect the heartof the nursing home industry: its workforce(Bostick et al. 2006). Labor is the single mostimportant input into the production ofnursing home care. Labor compensation,turnover, and staffing ratios are all closelyconnected to both quality of care and tounionization.

This paper provides context for the pro-posed labor law reform by shedding new lighton the role of organized labor in the provisionof nursing home care. We document thetrends and distribution of unionized staff andnew organizing activity across time, geogra-phy, and nursing home characteristics.

Background: Unionization andNursing Homes

Since the early 1980s, unions have mountedmany campaigns to organize nursing homes.In 1983, Service Employees InternationalUnion (SEIU) President John Sweeneylaunched a campaign to organize hundredsof chain-affiliated nursing homes. Uponsucceeding Sweeney as SEIU president in1996, Andy Stern vowed to further ramp upSEIU organizing and to make nursing homesa strategic focus. This ‘‘Dignity, Rights, andRespect’’ campaign aimed to organize at least100 nursing facilities per year. In 1999,United Food and Commercial WorkersInternational (UFCW) started a ‘‘Care forthe Caregivers’’ organizing campaign target-ing southern nursing facilities. Dozens ofother unions also attempted to organizenursing homes during these years, includingthe Teamsters, the Association of Federal,State, County and Municipal Employees(AFSCME), and the Steel Workers.

To various degrees, the unions mountedstrategic campaigns that combined organiz-ing nonunion workers, building coalitionswith nursing home reform advocates aroundhigher standards of care, negotiating union

contracts with terms aimed at improvingresident care standards and the skills andstability of the workforce, and lobbyingpublic agencies for changes in regulationand finance that would support organizingand bargaining goals. Issues where workers’and residents’ interests overlapped—such asprofessional development, minimum staffingratio policies, and laws allowing nursinghomes to defray the cost of wage increasesthrough increased reimbursements frompublic finance agencies—were made central.SEIU, in particular, also succeeded in build-ing alliances with some elements of nursinghome management to push for policy changesthat would benefit unionized nursing homesor the industry in general (Stern 2006). Inreturn, management agreed to remain neutralduring organizing drives (Hurd 2008). Thesecooperative efforts with some parts of man-agement were often paired with negative,corporate campaigns attempting to labeluncooperative companies as bad actorsdeserving extra scrutiny from regulators,consumers, and the public. With this strate-gic carrot-and-stick approach, unions havesought to shift the industry’s policy environ-ment, care standards, and labor standards indirections they prefer.

Managers pursue a range of strategieswhen faced with the prospect or the realityof an organizing campaign targeting theirnursing homes. Often, they view unions asan unwelcome third-party interfering in theemployer-employee relationship that couldlead to the loss of unilateral control and erodeprofitability (Simmons 1993; Benz 2005).Many managers pursue union-avoidancestrategies such as active campaigns againstunionization. Others engage in union-substi-tution activities such as matching pay andother standards at union facilities in order topreempt support for unionization (Logan2006). It appears that management resistancecan soften to the extent that unions’ strategiccampaigns moderate their bargaining pos-tures from conflict to cooperation and shiftthe industry’s policy environment to minimizethe economic costs of operating unionized(Hurd 2008).

Nursing homes are attractive organizingtargets for many reasons (Booth 1995).

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Nursing homes employ more than 1.6 millionpeople and this workforce is projected togrow by 24% over the next decade, based ondata from the Bureau of Labor Statistics(BLS) National Employment Matrix fornursing facilities. Organizing this industrycan raise membership levels considerably. Incontrast to many other sectors, nursing homemanagement has less ability to substitutetechnology for labor or to shift operationsto cheaper locales, removing threats com-monly exercised against unions, lowering theelasticity of labor demand, and increasingunions’ ability to secure economic gains formembers. The public’s large role in financingnursing home care—roughly two-thirds ofnursing home revenues come from Medicareand Medicaid—can create opportunities forunions to leverage their political influence tofacilitate organizing and bargaining.

Other characteristics of the nursing homeindustry may make organizing nursing homesdifficult. In many urbanized areas, thenursing home market is relatively competi-tive. This limits the economic profits availablefor division through bargaining and unions’ability to raise labor standards. To the extentthat a union organizes an entire local labormarket and any labor cost increases areuniformly applied across organizations, thisis less of a factor. Nursing homes are laborintensive operations—nursing labor accountsfor approximately two-thirds of the total costof nursing home care. The large labor inputshare may make it harder for unions to secureeconomic gains for members. On the otherhand, when such a workforce successfullyorganizes, management has a harder timeignoring members’ demands than in indus-tries where labor makes up only a small pieceof operations.

To provide institutional background andinsight into the challenge of study in this area,it is useful to understand that unions form inworkplaces by one of two avenues. First,workers can petition the NLRB to hold aunion certification election. If the majority ofworkers vote for the union, then the employeris legally required to bargain with the uniontoward a first contract. Otherwise, the em-ployer has no duty to bargain and the unionis not certified. Alternatively, employers may

choose to voluntarily recognize a union as thebargaining agent for its employees without anelection, due to a successful corporate orcard-check campaign run by a union andemployees at a specific workplace. Due tounions’ mounting frustration with the NLRBelection process, this second route to union-ization took off in popularity during the mid-1990s (Benz 2005). By 2001, the SEIUestimated that just over half of its successfulnursing home organizing campaigns occurredoutside the NLRB process (Childs 2002). Inany case, nursing homes and unions arerequired to notify the Federal Mediationand Conciliation Service (FMCS) as theyenter negotiations over first or subsequentcontracts.

Study Data and Methods

Unionization rates among nursing homeworkers are straightforward to estimate;however, calculating unionization amongnursing home facilities is more challenging.The Current Population Survey (CPS), along-standing survey carried out jointly bythe Bureau of Labor Statistics and the CensusBureau, gives insight into worker unioniza-tion. For monthly samples representing allU.S. households, the CPS provides informa-tion on individuals’ employment, unionstatus, and other variables. It offers a pictureof the union and nonunion nursing homelabor force over time and across states.

Publicly available measures of establish-ment-level unionization are not generallyavailable. The CPS does not disclose thefirms where individuals work, preventing itsuse in identifying particular nursing homes asunion or nonunion. From the firm side, theCenters for Medicare and Medicaid Services’(CMS) Online Survey, Certification, andReporting (OSCAR) system provides richestablishment-level data on all Medicaid-and Medicare-certified nursing home facilitiesin the United States (96% of all facilities). TheOSCAR data include information aboutwhether nursing homes are in compliancewith federal regulatory requirements. Follow-ing an initial survey, states are required tosurvey each facility no less than every15 months, and the average is about

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12 months. Nursing homes submit facility,resident, and staffing information. However,the OSCAR database does not distinguishunion from nonunion nursing homes.

To measure unionization at the facilitylevel and describe differences in the popula-tion of union and nonunion nursing homes,we study OSCAR data linked to NLRBunion election data and FMCS data on unioncontract negotiations. We began with dataprovided by Holmes (2006) that links nursinghome records from three sources: a) NLRBunion elections held between 1978 and 2002,b) FMCS bargaining notices filed between1986 and 2003, and c) CMS provideridentifiers for nursing homes in the OSCARsystem in either 1991, 1996, or 2001. Usingsources a and b, we measure nursing homes’unionization status over time. Using the CMSidentifiers (c), we link unionization measuresto a fourth data source, the complete OSCARpanel data of facility characteristics from1994 to 2002. Our measure of establishmentunionization indicates whether any of thenursing home’s workers are union. Becausenot all workers at a union nursing home arenecessarily in a union, the worker unioniza-tion rate from the CPS will be lower than theemployer-weighted rate from the mergedNLRB, FMCS, and OSCAR data.

The NLRB and FMCS data cover onlyprivate (i.e., nongovernment) nursing homes.Thus, we exclude government-owned facilities(about 8% of total) from the establishment-level analysis of unionization. Our resultingsample consists of 22,357 unique licensedfacilities; 14,556 were in operation in 1992,and 15,638 facilities in 2002. In our data,2,088 facilities had at least one certificationelection between 1978 and 2001. Of these,1,375 (66%) homes had at least one electionwhere a union won. In the other 713 facilitieswith elections, all elections went against theunion.

This measure of establishment-level union-ization permits new insight into two mainquestions. First, how do the characteristics ofunionized nursing homes compare to non-union nursing homes? With our data, we canbest measure the presence of any unionworkers in a nursing home rather than thefraction of union workers in a nursing home.

In a given year, a nursing home is designatedas union (having some unionized workers) ifit previously experienced either an NLRBrepresentation election won by a union or anFMCS notice of union contract negotiations.Otherwise it is designated nonunion. Nursinghomes are also designated as nonunion if anNLRB union decertification election inter-vened between the given year and the mostrecent prior certification election or FMCSnotice, and if the union lost the decertifica-tion election.

Here is the second question we can addresswith these data: Among nursing homes thatexperienced an NLRB union certificationelection, what are the characteristics offacilities that are associated with a greaterprobability of a union victory? Put anotherway, which contemporaneous nursing homecharacteristics predict union success in elec-tions? We analyze this question using morethan 1,400 elections that occurred between1994 and 2002 when the unionization dataand nursing home characteristics data over-lap.

The descriptive analyses are performed bysimply graphing the variables of interestalong time and geographic dimensions. Wealso use a linear probability model to estimatethe relationship between nursing home char-acteristics and the probability of two out-comes: that a facility is union rather thannonunion and that if an NLRB election isheld, the union wins rather than loses. Allregression results are robust to the use of alogistic model.

Results

Patterns in Worker Unionization across Timeand Geography

We first document the trend in the share ofworkers covered by a union contract overtime (see Table 1) based on the methods ofHirsch and Macpherson (2003). The CPSdata show that between 1985 and 2009, thefraction of nursing home workers covered byunion contracts fell from 14.6% to 9.9%, aloss of about a third. Over this same period,the total number of nursing home workersgrew by almost half, from 1.3 million to 1.8million. However, the number of covered

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nursing home workers remained quite stable,going from 188,803 in 1985 to 183,802 in2009. This occurred in the context of an evensteeper decline in union coverage amongprivate-sector workers generally. In thebroader economy, the share of private-sectorworkers covered by union contracts droppedfrom 15.9% to 8% over this period, a declineof about half.

We next describe the union coverage ratesby census division using data from 2000 to2009 (Table 2). Rates vary significantly acrossthe nine census divisions. Northern and WestCoast states with traditionally high rates ofunionization in the broader economy alsohave higher rates of nursing home unioniza-tion. The difference between the divisions islarge. The Middle Atlantic states have thehighest percentage of unionized nursing homeworkers with union coverage rates in excess of25%; the West South Central division has the

lowest unionization rates with slightly morethan 1% of their nursing home workforcecovered by a union contract.

Nursing Home Organization Elections

A primary pathway to unionizing a nursinghome is via an NLRB election. Figure 1presents trends in the number of NLRBelections in nursing homes from 1983 to2001. During this period, on average, morethan 160 elections occurred per year. Signif-icant volatility exists in the number ofelections across years. The highest numberof elections was 230 in 1997, and the lowestwas 112 in 1983. On average, a majority ofworkers voted in favor of a union in just over55% of elections, and this rate is fairlyconstant over the span of our data. Furtheranalysis of the election data reveals that theaverage pro-union vote share in elections wasjust over 50% during this period. So theelections were close on average.

Election volume picked up substantiallyafter 1995. There were fewer than 70,000nursing home workers involved in electionsin the five years between 1991 and 1995, butmore than 100,000 in the five years from 1996to 2000. This underestimates the increase inorganizing activity because campaigns outsidethe NLRB election process became increas-ingly popular through the 1990s. The uptick inactivity coincides with a period of tighter labormarkets. The implicit employment securityprovided by strong labor markets likely madeworkers more willing to unionize. There isevidence in our data that this surge in electionswas connected to the strategic campaignsmentioned earlier. SEIU and the UFCWaccounted for an increasing share of workersinvolved in elections. Between these periods,SEIU’s share of nursing home workers in-volved in elections increased from 25% to36%, accounting for half the overall growth inworkers involved. More modest but stillsignificant, the UFCW’s share went from10% to 12%, as the total number of electionsgrew dramatically.

Characteristics of Union and NonunionNursing Homes

Table 3 presents summary statistics of nurs-ing homes by an establishment’s unionization

Table 1. Percentage of workers covered byunion contracts in entire private-sectoreconomy and nursing care facilities by year

Year

Percent of worker unioncoverage

Difference(%)

Nursinghomes

Privatesector

1985 14.6 15.9 21.31986 12.6 15.2 22.61987 12.5 14.4 21.91988 13.3 14.0 2.71989 13.7 13.5 .21990 12.4 13.2 2.81991 13.3 12.9 .41992 12.2 12.5 2.31993 12.0 12.1 2.11994 14.1 11.9 2.21995 11.3 11.3 0.01996 12.2 11.0 1.21997 11.1 10.6 .51998 10.8 10.3 .51999 10.5 10.2 .32000 11.2 9.8 1.42001 10.7 9.7 1.02002 10.0 9.3 .72003 10.2 9.0 1.22004 9.6 8.6 1.02005 9.1 8.5 .62006 8.8 8.1 .72007 10.2 8.2 2.02008 9.1 8.4 .72009 9.9 8.0 1.9

Source: Current Population Survey, 1985–2009.

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status. We focus on 2002 because this is thelast year of data in the NLRB and FMCSrecords used to construct measures of estab-lishment-level unionization. Overall, about

18% of nursing homes had some unionworkers. On average, unionized nursinghomes were significantly (p,.01) larger asmeasured by the number of beds, residents,

Table 2. Percentage of nursing home workers covered by union contracts by census division

Censusdivision States

Mean(%)

Standarddeviation (%)

New England Connecticut, Massachusetts, Maine, NewHampshire, Rhode Island, Vermont

8.7 4.1

Middle Atlantic New Jersey, New York, Pennsylvania 25.4 10.1East North Central Illinois, Indiana, Michigan, Ohio, Wisconsin 11.0 6.3West North Central Iowa, Kansas, Minnesota, Missouri, Nebraska,

North Dakota, South Dakota4.6 4.5

South Atlantic District of Columbia, Delaware, Florida, Georgia,Maryland, North Carolina, South Carolina,Virginia, West Virginia

5.3 4.7

East South Central Alabama, Kentucky, Mississippi, Tennessee 2.4 .7West South Central Arkansas, Louisiana, Oklahoma, Texas 1.4 .7Mountain Arizona, Colorado, Idaho, Montana, New Mexico,

Nevada, Utah, Wyoming2.6 2.8

Pacific Alaska, California, Hawaii, Oregon, Washington 14.7 7.8

Source: Current Population Survey, 2000–2009.

Figure 1. Annual number of National Labor Review Board union certification elections innursing homes by election outcome, 1983–2001 (Source: Online Survey, Certification andReporting [OSCAR] data matched with NLRB data from Holmes 2006)

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and staff. For instance, union nursing homesaveraged 135 beds, while nonunion homesaveraged 102. Union nursing homes also hadsignificantly (p,.01) higher occupancy ratesthan nonunion nursing homes and a larger(p,.01) share of their residents’ expensesfinanced by Medicaid and Medicare. Unionnursing homes were more likely (p,.01) to behospital-based than nonunion nursing homesand less likely (p,.01) to be chain-affiliated.

Unionization rates across different facilitycharacteristics are presented in the bottompanel of Table 3. Among for-profit corporatehomes, 16.9% were unionized. Among secularnonprofit homes, almost 21% were unionized.On the other hand, the most striking fact maybe how small these differences appear.Unionization rates among nursing homes

owned by for-profit partnerships, for-profitcompanies, nonprofit churches, nonprofitcompanies, and other nonprofits range in arelatively narrow band between 16.9% and21%. Individually owned for-profits had aslightly higher unionization rate, 23.2%, butthese constituted only 2% of homes.

Although the variation in facility charac-teristics is not huge, the variation that doesexist may be explained by multiple factors.Larger nursing homes may be more profitableand thus the gains from organizing may belarger. It is also possible that these patternsare driven by geographic differences inunionization rates that happen to be corre-lated with the size and ownership status ofnursing homes. States that have a higherpropensity toward unionization may alsohave larger nursing homes.

To explore these possibilities, we estimate alinear probability model of the correlates ofunionization (Table 4) using the full panel ofnursing homes across years. Estimated coef-ficients of these characteristics on nursinghomes’ probability of being union are pre-sented in column 1, which excludes state fixedeffects, and column 2, which includes them.The results are largely consistent with thosedescribed previously from the simple analysisof mean differences. Nursing homes withmore residents are more likely to be union, asare those with a higher share of resident carefinanced through Medicaid (omitted catego-ry) and Medicare rather than private payers.For example, shifting from a 100% Medicaidfacility to a 100% private-pay facility woulddecrease the associated likelihood of unioni-zation by 23.8 percentage points. A hospital-based facility has a 10.2-percentage-pointhigher likelihood of unionization, while achain-based facility has a 1.4% higher likeli-hood. The positive association of unioniza-tion with being chain-based conditional onstate and other characteristics differs from theunconditional negative association in Ta-ble 3. Relative to corporate for-profit nursinghomes, church-related nonprofits are 2.4percentage points less likely to be unionized.Other ownership types do not have signifi-cantly different propensities to be union. Thecontrasting results in columns 1 and 2 suggestthat the association of unionization with

Table 3. Private-sector nursing homecharacteristics by union status, 2002

Union Nonunion

Mean nursing home beds 135.3 102.4(86.0) (58.2)

Mean total residents 113.2 82.3(76.3) (47.7)

Percentage occupancy 84.1 81.4(17.2) (19.0)

Percentage hospital-based 12.2 7.4(32.7) (26.2)

Percentage chain-affiliated 50.3 56.6(50.0) (49.6)

Residents by payer source

Percentage Medicaid 65.9 60.9(25.9) (25.9)

Percentage Medicare 15.5 13.5(21.1) (20.0)

Percentage privatepay/other

18.6 25.6(16.4) (20.1)

By ownership type

Total N (15,638) 2,829 12,809Percent (100.0) 18.1 81.9Individually owned 23.2 76.8Partnership 18.2 81.8Corporation 16.9 83.1Church-related 17.3 82.7Nonprofit corporation 20.9 79.1Other nonprofit 21.0 79.0

Source: The Online Survey, Certification, and Reportingdatabase, 2002; NLRB election and FMCS data fromHolmes (2006).Notes: Government-owned (i.e., state, county, city, city/county, hospital district, and federal) nursing homes areexcluded because the NLRB and FMCS jurisdiction onlycovers privately owned facilities.Standard deviations are in parentheses.

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individual or nonprofit corporate ownershipis driven by differences in ownership preva-lence between states (these forms are morelikely in more highly unionized states) ratherthan within-state differences in unionizationrates across ownership types. Payer mix ispredictive of union status. Controlling forinterstate differences in the propensity tounionize, institutions with a higher percent-age of private-pay residents are less likely tobe covered by a union contract.

Finally, we analyze the correlates of unionsuccess in NLRB elections using linearprobability models. We look at all nursinghomes that experienced union certificationelections over the period when OSCAR andNLRB data are available (1994–2002) and

use the nursing home characteristics from themost recent OSCAR survey prior to the dateof the election. Column 3 presents estimateswithout state fixed effects and column 4 withstate fixed effects. Occupancy rate has asignificant but small negative association withunion success. Elections in both hospital-based and chain-affiliated homes are morelikely to be successful than elections in otherhomes, although the estimates are somewhatimprecise. A higher share of residents fi-nanced by Medicaid is strongly predictive ofunion success relative to the financed share ofboth Medicare and private payers. Specifical-ly, a shift from 100% Medicaid to 100%Medicare would decrease the likelihood ofunion success by 36.6 percentage points,

Table 4. Nursing home characteristics as predictors of union status and union victory incertification elections

Union status Election outcome

(1)a (2)b (3)a (4)b

Beds .0001 .0001 2.0003 2.0002(.0001) (.0001) (.0003) (.0003)

Total residents .001*** .001*** .0002 .0002(.0001) (.0001) (.0004) (.0004)

Occupancy rate 2.0002 2.0010*** 2.002** 2.003**(.0001) (.0001) (.001) (.001)

Hospital-based .107*** .102*** .058 .055(.012) (.011) (.051) (.055)

Chain-affiliated 2.025*** .014*** .041 .055*(.005) (.004) (.028) (.029)

Percentage Medicare .002 2.042*** 2.350*** 2.366***(.014) (.013) (.075) (.080)

Percentage privatepay/other

2.190*** 2.238*** 2.282*** 2.312***(.011) (.011) (.078) (.079)

Individually owned .071*** .018 2.076 2.062(.014) (.012) (.088) (.093)

Partnership 2.005 2.004 2.060 2.081(.008) (.007) (.053) (.053)

Church-related .009 2.024*** .059 .069(.010) (.009) (.046) (.049)

Nonprofitcorporation

.039*** .002 2.056 2.057(.007) (.006) (.035) (.036)

Other nonprofit .022 .006 2.035 2.029(.017) (.016) (.112) (.118)

State fixed effects No Yes No YesR-squared .072 .203 .039 .100N 204,809 204,809 1,473 1,473

Source: The Online Survey, Certification, and Reporting Database (1994–2006); NLRB election and FMCS data fromHolmes (2006).Notes: Standard errors are in parentheses and are clustered by nursing home. All four specifications include year fixedeffects. For years 2003–2006, the union status values are carried forward from 2002.a Excludes state fixed effects.b Includes state fixed effects.* Significant at 10%; ** significant at 5%; *** significant at 1%.

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while the shift to 100% private-pay woulddecrease the likelihood of union success by31.2 percentage points. The correlation be-tween Medicaid and successful unionizationmay be related to poorer working conditionsin these low-resource facilities or unions’greater ability to leverage political influencein support of organizing.

Discussion

Although unionization rates in the nursinghome industry have been declining for the last25 years, labor law reform has the potentialto reverse this trend. If elements of EFCA areadopted legislatively or administratively, ourresults suggest nursing homes caring forgreater numbers of Medicaid and Medicareresidents are more likely to be unionized thannursing homes treating private-pay residents.Our results also suggest a greater likelihoodof unionization in larger nursing homes,hospital-based facilities, and chain-ownednursing homes.

A key issue arising from our resultsconcerns the decline in nursing home workerunionization. Unions’ strategic efforts toorganize nursing home workers did slow therate of decline compared to the private-sectoreconomy generally, but clearly other forcespushed the rate of unionization down. Whileshifts in employment away from highlyunionized manufacturing to less-unionizedindustries may help explain decreasing union-ization in the overall economy, it cannotexplain declines within a particular sector,such as nursing homes. Low-cost foreigncompetition also is not a factor. More viableexplanations include: 1) employment shiftsfrom more to less unionized states, 2)unionized workers dissolving their unionthrough decertification elections, and 3) shiftsin the population of nursing homes towardnew, unorganized entrants. As we subse-quently discuss, only the third explanationholds up to analysis.

Regarding the first explanation, regionalshifts in employment from the more heavilyunionized Northeast and Midwest to otherregions within the United States couldpotentially be a factor. In the South andSouthwest, political and historical traditions

have produced lower unionization rates, andover the period of our study, these regionshave gained population share. Northeast andMidwest states comprised 46% of the U.S.population in 1983 and only 39% in 2008,according to census estimates. Similarly, theirshare of population age 65 and over wentfrom 49% to 41%. This trend may have led toa shift in the location of those who maydemand nursing home services, and hence ashift in nursing homes from unionized tononunionized environments. To test this, weexamine how much of the change in thenational unionization rate over the last 25 yearshas been due to within-state declines in theunionization rate and how much to between-state shifts in nursing home employment.

The national worker unionization ratedecline is almost wholly attributable todeclines within states rather than shifts inemployment across states. To analyze this, wecomputed the unionization rate and employ-ment share in a base period (1984–1989) anda final period (2003–2008) for each state.Using the years 1990–1995 as the base periodproduced very similar results. With this, weanswer two hypothetical questions. First,what would the national unionization ratebe in the final period if each state’s unioni-zation rate remained fixed at its base level butits employment share shifted by the observedamount? In fact, the unionization rate wouldbarely have budged, going from the 14.0%base to 13.9%. In contrast, when we ask whatthe national rate would have been in the finalperiod if each state’s employment share stayedfixed at its base level but its unionization rateshifted by the observed amount, we obtain aunionization rate that matches the observedone, 9.5%. This suggests that regional employ-ment shifts did not generate the decline innursing home worker unionization. The an-swer lies in changes going on within states.

A second possibility is that union nursinghome workers decided to dissolve their unionthrough the NLRB’s decertification process.Although this might have been a smallcontributor, it could not have been a maindriver. Among the more than 12,800 non-union nursing homes operating in 2002, fewerthan 100 became nonunion through unionlosses in decertification elections.

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A third remaining explanation involvesturnover in the population of nursing homes,with new entrants remaining nonunion. Thisexplanation is more promising. In any givenyear in our data, no more than 5% of nursinghomes exited the OSCAR database and nomore than 6% were new entrants. However,over longer periods, this churning means thatnew entrants make up a significant share ofnursing homes. For instance, about a quarterof the homes active in 2002 were new entrantswithin the prior eight years. New entrantsgenerally require new organizing to becomeunionized. Most establishments start off asnonunion although some unionized compa-nies immediately recognize unions for work-ers in new facilities. It is unclear whetherunion avoidance is a precipitating factorto ownership turnover and we know ofno evidence on this point. Regardless, neworganizing in the current legal environmenthas proven difficult, leading unions to prior-itize labor law reform through EFCA (Benz2005). Holmes (2006) documents significantspillovers in unionization across industries.The decline in unionization across the broad-er economy may have affected the nursinghome industry, making the policy and eco-nomic environments less conducive to orga-nizing and thus helping account for thepatterns we observe in our data.

Moving forward, an important issue in-volves whether unionization matters for thedelivery of nursing home services. In theory,unionization of the nursing home workforcemay have implications for the welfare ofworkers, patients, and the nursing homesector more generally. However, relativelylittle research to date has considered theseissues. We briefly consider each issue with theidea that future research is needed in thisarea.

Unionization and Worker Outcomes

In general, unions seek changes that benefittheir members, which usually entail a mix ofricher compensation, better working condi-tions, increased training and professionaldevelopment opportunities, and greater em-ployment security. The hospital literature onunionization and nurse wages is generallyinconclusive with some of the research

suggesting a significant positive impact ofunionization and other research concludingthat unions do not affect nurses’ wages (e.g.,Adamache and Sloan 1982; Hirsch andSchumacher 1995; Feldman and Scheffler1982). To date, little is known empiricallyabout the causal impact of unions on nursinghomes and their workers. In theory, however,unions are expected to have a positive effecton the compensation of nursing home work-ers, which in turn can affect the size andaverage quality of a nursing home’s staff.That is, unionized workers should have betterpay, greater job stability, and better workenvironments (Temple, Dobbs, and Andel2009). To the extent that union nursinghomes cannot pass higher wages through tocustomers, higher wages may translate intofewer nursing home staff. Thus, it could bethe case that unionization leads to higherwages for individuals able to obtain jobs inthe nursing home sector, but there may befewer jobs as a result. To escape this wage-employment trade-off, unions have supportedin more than 20 states wage pass-throughlaws that offset wage increases with higherstate nursing home reimbursements andtherefore make it less costly for nursing homemanagement to increase wages. Unions havealso lobbied successfully for higher state-mandated minimum staff-patient ratios,which can improve working conditions acrossthe industry while putting a floor undernegative employment effects (Chen 2008).

Unionization and Patient Outcomes

Through unions’ effects on the quality andquantity of nursing home staff and on theterms of employment, unions also have thepotential to meaningfully impact residentoutcomes. The nursing home literature gen-erally suggests that the level and type ofstaffing in nursing homes are related topatient outcomes (Konetzka, Stearns, andPark 2008; Grabowski et al. 2008). Unionshave argued that organized nursing staffs arebetter able to care for patients because theycan attract, retain, and train higher-qualitystaff. Higher staff-patient ratios tend tobenefit both patients and workers. Alterna-tively, a union wage premium may have anegative effect on the number of staff, which

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may lower the quality of care. Again, little isknown about the impact of unions on thequality of care in nursing homes. A study ofCalifornia nursing homes in 1999 found thatunionized facilities had more complaints thannonunionized facilities, but fewer substanti-ated serious violations (Swan and Harrington2007).

Unionization and Firm Outcomes

By raising worker compensation, unioniza-tion may reduce the profitability of individualnursing homes and increase the likelihood ofclosure. On the other hand, unions can act aspowerful allies with management in lobbyingfor policies that favor the industry, such ashigher Medicaid reimbursement rates. By thisavenue, firms in markets with stronger unions

could prove more profitable than those inmarkets with weaker unions. Thus, theoverall implications for revenue and profitsare ambiguous.

Unions may have important implicationsfor the welfare of both workers and patients,and also the financial health of the industry.As already noted, unionization of the nursinghome workforce has been declining over thepast 25 years, but due to strategic efforts by ahandful of unions the decline has been at aslower rate than in the rest of the economy.Proposed labor reform legislation has thepotential to greatly expand the number ofunionized facilities. Future research will needto consider the potential impact of nursinghome unionization on worker, patient, andfirm outcomes.

References

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Benz, D. 2005. It Takes a Village to Win a Union:A Case Study of Organizing among Florida’sNursing Home Workers. Politics and Society33(1):123–152.

Booth, A. L. 1995. Economics of the Trade Union.Cambridge, U.K.: Cambridge UniversityPress.

Bostick, J. E., M. J. Rantz, M. K. Flesner, andC. J. Riggs. 2006. Systematic Review of Studiesof Staffing and Quality in Nursing Homes.Journal of the American Medical DirectorsAssociation 7:366–376.

Chen, M. 2008. Vertical Differentiation andFactor Substitution: An Empirical Study ofMinimum Quality Standards in the NursingHome Industry. Working paper. Evanston, Ill.:Kellogg School of Management, NorthwesternUniversity.

Childs, N. 2002. Union Organizers Look atNursing Facilities. Provider 28(6):22–24, 27–28, 31–34.

Epstein, R. A. 2009. The Case against theEmployee Free Choice Act. Stanford, Calif.:Hoover Press.

Feldman, R., and R. M. Scheffler. 1982. The UnionImpact on Hospital Wages and Fringe Benefits.Industrial and Labor Review 35(2):196–206.

Fletcher, M. A. 2008. Battle Intensifies Over Billto Expedite Union Organizing. The Washing-ton Post October 24:A17.

Grabowski, D. C., K. A. Stewart, S. M. Broder-ick, and L. A. Coots. 2008. Predictors ofNursing Home Hospitalization: A Review ofthe Literature. Medical Care Research andReview 65(1):3–39.

Hirsch, B. T., and E. J. Schumacher. 1995.Monopsony Power and Relative Wages in theLabor Market for Nurses. Journal of HealthEconomics 14(4):443–476.

Hirsch, B. T., and D. A. Macpherson. 2003.Union Membership and Coverage Databasefrom the Current Population Survey: Note.Industrial and Labor Relations Review 56(2):349–354.

Holmes, T. J. 2006. Geographic Spillover ofUnionism. In Federal Reserve Bank of Min-neapolis, Research Department Staff Report368. Minneapolis, Minn.

Hurd, R. W. 2008. Neutrality Agreements: Inno-vative, Controversial, and Labor’s Hope forthe Future. New Labor Forum 17(1):35–44.

Konetzka, R. T., S. C. Stearns, and J. Park. 2008.The Staffing-Outcomes Relationship in Nurs-ing Homes. Health Services Research 43(3):1025–1042.

LaPorte, M. 2009. Firestorm Brewing over LaborBill. Union Membership Could Rise underLegislation. Provider 35(1):26–28.

Logan, J. 2006. The Union Avoidance Industry inthe United States. British Journal of IndustrialRelations 44(4):651–676.

Mascaro, L., and M. Mishak. 2010. Prospects forOrganized Labor’s Legislative Agenda Fading

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Rapidly. The Las Vegas Sun February 6, www.lasvegassun.com/news/2010/feb/06/union/.

Simmons, J. P. 1993. Rulemaking: The NationalLabor Relations Board’s Prescription for theRecurring Pains of the Health Care Industry.Journal of Contemporary Health Law andPolicy 9:377–418.

Stern, A. 2006. A Country that Works. New York,N.Y.: Free Press.

Swan, J. H., and C. Harrington. 2007. CaliforniaNursing Facility Quality and Union Environ-ments. Journal of Aging and Health 19(2):183–199.

Temple, A., D. Dobbs, and R. Andel. 2009.Exploring Correlates of Turnover amongNursing Assistants in the National NursingHome Survey. Health Care Management Re-view 34(2):182–190.

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