Postmortem: AB 650 was hazardous to public health

In early June, to the great relief of public and private healthcare organizations throughout California, the legislature put Assembly Bill (AB) 650 to rest. It would have required healthcare providers to pay $10,000 in bonus pay to full-time front-line workers who worked during the pandemic. At its apex, the extraordinarily high cost of this unfunded mandate would have imperiled not only for-profit healthcare corporations but also thousands of nonprofit healthcare providers and the populations they serve. Here is our postmortem.

Sponsored by the Service Employees International Union (SEIU), AB 650 would have required a broad swath of publicand private-sector healthcare institutions to pay hazard pay ($10,000 to full-time employees) to a broadly defined set of healthcare workers who combatted COVID-19. The author of the bill, Assemblyman Al Muratsuchi (D-Rolling Hills Estates) noted that "the bill was a way to honor the front-line healthcare workers who went to work despite the threat that COVID-19 posed to themselves and their families." No group of employees could be more deserving. However, AB 650's largely unfunded mandate endangered the majority of healthcare nonprofits and rural hospitals that were already barely surviving.

Reportedly, the legislation was originally aimed at for-profit hospitals and big nonprofit healthcare organizations (Kaiser in particular), but its original version covered public and private healthcare providers throughout California's public and private sectors, including hospitals, mental health providers, and community health centers (CHCs).