Californians who work in hospitals and other medical facilities, including receptionists, cleaners and security guards, could see a significant increase after the state Legislature approved a $25 per hour minimum wage requirement Thursday evening.

The fate of the bill now rests in the governor’s hands. Gavin Newsom, and comes after a hard-fought agreement between unions calling for more support for workers deemed essential workers in the pandemic and industry executives concerned about costs as financially struggling health plans brace for closure.

Last-minute changes to the bill, including a provision that would prevent cities and counties from raising wages locally for the next decade reflect the concessions made to employers in an attempt to reach the finish line.

Even union-friendly Democrats were initially reluctant to pass the worker-targeted bill, worried that rural community hospitals that were already failing would collapse under massive wage increases or pass the costs on to patients.

Under the bill, workers in large health care facilities would earn $23 starting next year; $24 per hour by 2025 and $25 by 2026. That applies to all staff, including nursing assistants, medical coders, money launderers and hospital gift shop employees.

On Thursday, in the final hours of California’s legislative session, the bill, SB 525, was approved by lawmakers after months of negotiations with unions and lobbyists representing nurses, hospitals and dialysis clinics.

“When I first introduced this bill on this floor, there was a lot of talk, a lot of issues and concerns were raised, and I took them to heart,” said Sen. Maria Elena Durazo (D-Los Angeles), who wrote the bill, said in the Senate on Thursday.

The bill would establish the nation’s first minimum wage for healthcare workers. But it’s still unclear whether the Democratic governor will sign it into law.

The governor has warned against vetoes over cost considerations as the state faces a $31.5 billion deficit.

An earlier legislative analysis of the proposal estimated that it would cost California $973.7 million annually to pay for wage increases at state facilities, plus an “absolutely significant” unspecified amount to increase wages for non-healthcare workers due to parity requirements at facilities from the University of California. .

The cost of the bill in its current form is still being calculated, but is expected to be lower due to significant changes.

State Republicans voted against the bill Thursday even after its many changes, fearing that rural hospitals and clinics will still struggle with wage increases, and that Californians will in turn see more expensive medical bills.

“We keep raising the cost of living, so we have the mentality that we just need to raise the minimum, and we just keep pushing it higher and higher,” Sen. Devon Mathis (R-Porterville) said at the meeting. “But someone has to pay for that increase.”

The bill was originally intended

increase

wages for all eligible healthcare workers next year

have an impact

an estimated 469,000 people, but changes added this week have delayed implementation and staggered the increases depending on where employees work.

Workers at independent rural hospitals and places that serve many Medicare and Medi-Cal patients will see just $18 an hour next year, and not $25 an hour until 2033. Other smaller facilities, including urgent care clinics and skilled nursing facilities, would have to pay their workers $21 per hour next year, gradually reaching $25 per hour by 2028.

The bill now allows some facilities to apply for temporary waivers if they can demonstrate financial hardship. In addition to a moratorium on local healthcare wage regulations until 2034, SB 525

would

So

block efforts to cap hospital executives’ pay, such as the measure expected by Los Angeles voters next year.

If

the bill

has been signed into law, this measure, along with any new city ordinances that aim to increase healthcare workers’ salaries, appears to be null and void.

Cities including Los Angeles and Long Beach,

under pressure

SEIU had approved a minimum wage of $25 per hour for local health care workers. But those initiatives have been put on hold after a coalition of hospitals and other industries gathered enough signatures to ask the question

local

voters, who are trying to repeal them over concerns that universal wage increases would force facilities to scale back their programs, ultimately reducing patient care.

California hospitals

Assn.,

who have opposed the local ordinances, changed their position on SB 525 from opposing to supportive after the latest changes this week.

Carmela Coyle, president and CEO of the association, called the final version of the bill a “landmark deal” that strikes a balance between “significantly improving wages, protecting jobs and safeguarding care at community hospitals across the state .

Coyle said wages should be set by the state rather than through local initiatives to “create greater equity for all California health care workers.”

The California Dialysis Council also withdrew its opposition after a behind-the-scenes deal was made with health care worker union leaders to block the fight.

at least until 2026

on costly, recurring ballot measures related to the operation of kidney dialysis clinics. California voters have repeatedly rejected a statewide mandate to expand staffing levels at the centers, an ongoing battle between health care worker unions and dialysis companies.

This agreement protects patients from the ongoing threats in the elections and in the Legislature, while also providing additional pay increases for many healthcare workers,” said Jaycob Bytel, spokesperson for the California Dialysis Council.

Nearly half of the workers expected to see a pay increase under the bill are Latino, and 75% are women, according to a report from the UC Berkeley Labor Center.

Advocates say understaffed hospitals are a threat to patient care, and raises are needed to combat the state’s shortage of healthcare workers as medical facilities lose workers to the retail, food and hospitality industries as they pay some staff members more and can be less stressful.

Tia Orr, executive director of SEIU California, called the statewide minimum wage plan “a historic breakthrough.”

Everyone in healthcare understands that we are facing a workforce crisis and that wages are the key to any solution, Orr said.