SACRAMENTO — Duane Dauner, president of the California Hospital Assn., emailed the group's board in September with a warning:
The leader of the state's largest healthcare workers' union had told him that if hospitals did not pave the way for the organizing of 20,000 workers, the union would launch ballot measures taking aim at hospital pricing and executive pay.
But negotiations on organizing agreements between the two sides stalled. In November, the union, SEIU-United Healthcare Workers West, filed two initiatives for the 2014 ballot that would limit hospital prices and cap executive compensation at nonprofit hospitals.
The union disputes Dauner's characterization that the initiatives were filed to force cooperation with its organizing efforts. But the standoff underscores how the initiative process, often used as leverage for legislative action, can also be used as a weapon beyond the Capitol.
Jamie Court, president of Consumer Watchdog, said he supports the aims of the ballot measures but disagrees with the tactic of "using the ballot initiative process and SEIU's money to basically shake down the hospitals."
Dave Regan, the union's president, said Dauner's characterization of the labor group's position is "very narrow, inaccurate and incredibly incomplete." He said the union has talked with the industry about changing prices and hospital operations, in addition to organizing.
"Are they prepared to make concrete agreements to reduce the cost of care?" Regan said. "The answer is no."
Jan Emerson-Shea, the hospital association's vice president of external affairs, said the group stands by Dauner's memo.
Last year, the union proposed similar ballot initiatives but dropped them when it announced an agreement with Dauner's group to work toward lower healthcare costs and better care. The pact also stated that the union's goal was an opportunity to organize up to 100,000 workers by 2015.
In his Sept. 25 email to health executives, Dauner said Regan had "expressed disappointment" over progress on Service Employees International Union's organizing goals.
"SEIU expected elections covering 20,000 employees in hospitals under a mutually developed code of conduct," Dauner wrote, referring to the process by which workers elect to join a union. "Thus far, no progress has been made toward agreements for elections."
Emerson-Shea said the filing of the initiatives "puts a puts a cloud over all of the good things that came out of that 2012 agreement."
Regan said the union is prepared to spend $4 million to collect signatures to qualify its measures for the ballot and up to $20 million to campaign for their passage. But the two sides are still talking, and the union could decide to pull the plug on the initiatives.
In a letter to individual healthcare chief executives on Nov. 21, Regan floated a new agreement that would include partly tying workers' pay to the quality of care, limiting layoffs and promising no strikes.
Although Regan's letter does not mention organizing efforts, they have been a "very explicit" part of the negotiations, said Steve Trossman, the union's communications director.
"If we could reach an agreement" on the broad labor issues, he said, "then we would definitely consider dropping the initiatives."
Times staff writer Paul Pringle contributed to this report.