Hospitals in New York City and the largest health care union have agreed on a new contract that bails out the union?s ailing health care benefits fund, officials said yesterday. The current contract is not set to expire for 15 months, but the union, 1199 SEIU United Healthcare Workers East, and the hospitals agreed to open negotiations in part because the benefits fund faces a deficit of more than $700 million over the next five years, a result of rising medical costs. The union and the League of Voluntary Hospitals, the labor relations group for most hospitals in the city, made a similar decision three years ago, when they reached a new pact with more than a year left on the previous one. In that case, 1199 agreed to a smaller pay increase to preserve health benefits.
See "Hospitals and Their Workers Reach a Pact on Health Care", Richard Perez-Pena, The New York Times, January 22, 2007