Report 2011-113 Recommendations and Responses in 2015-041

Report 2011-113: Salinas Valley Memorial Healthcare System: Increased Transparency and Stronger Controls Are Necessary as It Focuses on Improving Its Financial Situation

Department Number of Years Reported As Not Fully Implemented Total Recommendations to Department Not Implemented After One Year Not Implemented as of 2014-041 Response Not Implemented as of Most Recent Response
Salinas Valley Memorial Healthcare System 3 15 1 1 1

Recommendation To: Salinas Valley Memorial Healthcare System

To help reduce its operating costs and improve its overall financial situation, the Health Care System should continue to try to modify its employee benefits, such as paid time off, so they are aligned with industry practice.


SVMHS, from the Board of Directors through the Administrative Team, wholly embraces Recommendation #5 and recognizes that the future financial stability of the health system depends on its ability to reduce overall operating costs, including the alignment of employee benefit costs with industry standards.

The SVMHS employee population includes non-represented staff and staff represented by three different bargaining units.

During fiscal year 2013-2014, SVMHS initiated contract bargaining with the California Nurses Association (CNA) and International Union of Operating Engineers, Stationary Engineers Local No. 39 (Local 39).

SVMHS provided proposals to CNA (~600 employees) and Local 39 (~20 employees) to better align the employee health plan and Paid Time Off (PTO) accruals with industry standards over a 3 to 4-year period.

While the health plan proposal was not adopted by either bargaining unit, the PTO provisions (cap and accrual level) were adopted by both. PTO caps were implemented on June 6, 2015 for non-represented staff and accrual levels are under revision.

In fiscal year 2014-2015, SVMHS initiated contract bargaining with the National Union of Healthcare Workers (NUHW) (~700 employees). SVMHS provided proposals to NUHW to better align the employee health plan and Paid Time Off (PTO) accruals with industry standards over a 3 year period. These proposals are in line with those presented to CNA and Local 39. Negotiations with NUHW are ongoing. In fiscal year 2014-2015, the health plan and PTO changes were outlined for the non-represented staff (~300 employees). Once changes to the health plan design are implemented with NUHW, commensurate changes will be made with non-represented staff.

The executive leadership team and Board of Directors continue to track progress toward the overall goal of reduced operating expenses, including aligning benefit costs with industry practice.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: 10/31/16
  • Response Date: September 2015

Current Status of Recommendations

All Recommendations in 2015-041