NBER WORKING PAPER SERIES DO STRIKES KILL? EVIDENCE FROM NEW YORK STATE

Concerns over the impacts of hospital strikes on patient welfare led to substantial delay in the ability of hospitals to unionize. Once allowed, hospitals unionized rapidly and now represent one of the largest union sectors of the U.S. economy. Were the original fears of harmful hospital strikes realized as a result? In this paper we analyze the effects of nurses’ strikes in hospitals on patient outcomes. We utilize a unique dataset collected on nurses’ strikes over the 1984 to 2004 period in New York State, and match these strikes to a restricted use hospital discharge database which provides information on treatment intensity, patient mortality and hospital readmission. Controlling for hospital specific heterogeneity, patient demographics and disease severity, the results show that nurses’ strikes increase in-hospital mortality by 19.4% and 30-day readmission by 6.5% for patients admitted during a strike, with little change in patient demographics, disease severity or treatment intensity. This study provides some of the first analytical evidence on the effects of health care strikes on patients, and suggests that hospitals functioning during nurses’ strikes are doing so at a lower quality of patient care. Jonathan Gruber MIT Department of Economics E52-355 50 Memorial Drive Cambridge, MA 02142-1347 and NBER gruberj@mit.edu Samuel A. Kleiner Heinz College Carnegie Mellon University 5000 Forbes Avenue Pittsburgh, PA 15213-3890 skleiner@andrew.cmu. edu Hospitals are one of the most important employers in the United States. Thirty-five percent of U.S. health care workers, and 3.25% of all U.S. workers, work in hospitals. Due to the importance of hospitals in providing health care to our nation, and fears that work stoppages could place patient health in jeopardy, hospitals were excluded from collective bargaining laws for almost three decades after other sectors were allowed to unionize. Once allowed to do so in 1974, however, hospitals quickly became one of the most important sources of union jobs in the U.S. Over fifteen percent of hospital employees are members of a union, representing six percent of all union employees in the U.S. While unionization has been declining in its traditional industrial home, it is growing rapidly in the hospital sector, with the number of unionized hospital workers rising from 679,000 in 1990 to nearly 1 million in 2008. Despite the rapid unionization of the hospital sector, we know little about the original government concern that led to the long delay in permitting unionization: do strikes jeopardize patient health? In this paper, we carefully examine the effects of nursing strikes at hospitals on patient care and health outcomes. Nurses are a crucial part of the hospital production function and are, as one hospital CEO said, “the heart and soul of the hospital. ” They serve as the surveillance system of hospitals for detection and intervention when patients deteriorate, and are viewed by many patients as more important to their total recuperation process than their own attending physicians (Kruger and Metzger, 2002). Thus, one might presume that strikes by nurses would be harmful to patients’ health. Yet, at the same time, a large literature in health economics documents substantial overtreatment in hospitals in the U.S.; for example Fisher et al. (2004) find no association between increased treatment intensity across medical centers and improved 1 http://www.bls. gov/oco/cg/cgs035.htm, http://www.bls. gov/news.release/ecopro.t04. htm 2 This figure represents the number of hospital employees that are union members. The percentage of hospital employees covered by a collective bargaining agreement is 17% (Source: Unionstats.com). 3 Source: Unionstats.com 4 Draper (2008)