Hospitals, Insurance, and the American Labor Movement: The Case of New York in the Postwar Decades

In the summer of 1989, an extended strike by the various “Baby Bell” telephone companies, including those of New York, Massachusetts, California, and thirteen other states in the Northeast, Midwest, and West Coast, brought to public attention the importance of health and hospital insurance to the nation's workers. In what theLos Angeles Timesheadline proclaimed was a “Phone Strike Centered on the Issue of Health Care,” workers at NYNEX, Pacific Bell, and Bell Atlantic went out on strike over management's insistence that the unions pay a greater portion of their hospital insurance premiums. In contrast to their willingness to grant wage concessions throughout most of the 1980s, the unions and their membership struck to protect what was once considered a “fringe” benefit of union membership. What had been a trivial cost to companies in the 1940s and 1950s had risen to 7.9 percent of payroll in 1984 and 13.6 percent by 1989. Unable to control the industry that had formed around hospitals, doctors, drug companies, and insurance, portions of the labor movement redefined its central mission: the fringes of the previous forty years were now central concerns. In the words of one local president engaged in the bitter communication workers strike: “‘It took us 40 years of collective bargaining’ to reach a contract in which the employer contributed [substantially to] the costs of health care, ‘and now they want to go in one fell swoop backward.’”