The contractor that runs call centers for Medicare, as well as the federal ObamaCare marketplace, isn’t even two years into a nine-year deal, so why is the Department of Health and Human Services accepting new proposals this week? The answer seems to be that the Biden Administration wants to push more than 10,000 workers into a union.

HHS Secretary Xavier Becerra said late last year he intended to redo the contract, this time with a “labor harmony requirement.” Notices of intent to compete for the job were due June 21, and the department plans to announce the winner by Jan. 16, 2025, four days before the next presidential inauguration. The current contractor, Maximus, gets good ratings, but Becerra cited the need to ensure “continuity of operations.” The insinuation is that some kind of labor dispute could leave 1-800-MEDICARE with a busy signal.

This concern is baseless, the company says. “Maximus has only experienced five brief labor-related demonstrations since 2018, and all were sparsely attended,” it told HHS in a letter last month. “Barely 1 percent of the Maximus workforce has participated in any given demonstration,” and “many of the participants were paid by the union.” Meanwhile, “our Customer Satisfaction scores averaged 95.6 percent across those five demonstrations.”

Maximus won the current deal in September 2022, after almost three years of HHS procurement work. The contract is renewable annually for nine years, and it’s worth $6.6 billion. In the last year the company answered about 30 million Medicare and ObamaCare calls. Its employees working on the contract, up to 13,000, are based in right-to-work states: Arizona, Florida, Kansas, Kentucky, Louisiana, Mississippi, Nebraska, Texas and Virginia.

The HHS request for proposal says a “labor harmony agreement,” at minimum, prohibits work stoppages. In exchange, though, unions could seek such concessions as access to workers or the ability to unionize via “card check” instead of a secret ballot. Under HHS’s terms, negotiations would be required when a union “demonstrates intent to represent service employees performing work under this contract.” Then an executed labor harmony agreement is due in 120 days.

Consider the leverage this gives labor organizers. Any union that “demonstrates intent” to organize Medicare call centers, even if most employees disagree, can use the threat of breach of contract to demand negotiations. What if the union makes unreasonable demands?

Maximus has argued to HHS that this is a wrong turn. Adding unions could frustrate performance by making call centers less flexible and adaptive. The broad language in the HHS document leaves many questions unanswered, so it isn’t clear how this is supposed to work in practice. Maximus’s letter last month also says the mandate for a labor harmony agreement is “contrary to law.”

The point of contracting is to serve taxpayers, yet HHS is subordinating this goal to a union agenda. “I’ve been around this business for almost half a century now, and I’ve never seen this kind of action with this kind of intent,” David Berteau, CEO of the Professional Services Council trade group, said recently. “It’s done without cause. There’s no reason for it other than to insert a labor harmony agreement into the existing work.”

The Wall Street Journal