California law subsidizes cost of health insurance for striking workers

A new California law slated to take effect in July provides workers at private employers and their family members with continued access to health coverage during a strike.

The legislation was authored by assembly member Jim Wood and signed by Gov. Gavin Newsom in September. 

"In a perfect world, workers should never have to use this new law and my hope is that employers will choose to continue health coverage voluntarily during labor disputes and not use it as a weapon during negotiations," Mr. Wood said in a news release.  

The new law comes after Palo Alto, Calif.-based Stanford Health Care and Lucile Packard Children's Hospital notified union leaders in April that nurses who went on strike risked losing pay and health benefits. Additionally, members of the American Federation of State, County and Municipal Employees Local 829, who went on strike this year at Sequoia Hospital in Redwood City, Calif., received a similar notification.

Under the new law, workers at private employers may maximize state subsidies for coverage purchased through California's health insurance marketplace, Covered California, if they lose coverage during a labor dispute, according to Kaiser Health News

Eligible individuals would receive the same premium assistance and cost-sharing reductions as an individual with a household income of 138.1 percent of the federal poverty level, the law states. Effective Jan. 1, 2024, eligible individuals would also not pay a deductible for any covered benefit if the standard benefit design for that income level has no deductibles. Coverage would stop once employees are back at work.

Stanford Health Care and Sequoia Hospital's operator, Dignity Health, did not respond to requests from Kaiser Health News for comment. Becker's also reached out to the organizations and will update the story if comments are received.

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