Worker Co-Ops in Health Care: Lessons from the Field

When people think of healthcare workers, they often think first of doctors in white coats and professionals with a lot of letters listed after their names. But millions of workers in healthcare settings contend with low wages, unpredictable hours, limited benefits, physical risks, and rigid workplace hierarchies. And as a society, we underpay—and under care for—the very workers we rely on to provide health and care services to others. 

Is it possible to organize private healthcare businesses in ways that don’t extract profits and instead share ownership and control with workers by design? It is.

The US Labor Department estimates that full-time healthcare support workers earn $16.16 an hour or $33,600 a year at the median, according to 2022 data. A typical home care worker earns even less, just $18,100 per year, according to PHI, the nonprofit organization formerly known as the Paraprofessional Health Institute. Black, Latinx, immigrant, and women workers are heavily concentrated in low-wage health sector jobs with poor working conditions.

As is well known, the United States relies far more on for-profit businesses to meet its population’s health and care needs than most other countries. Exacerbating the commercialization of health, private equity firms, which pool money from groups of investors, are buying more health companies to restructure and sell the companies at a profit.

But is it possible to organize private healthcare businesses in ways that don’t extract profits and instead share ownership and control with workers by design? It is. We are beginning to see a growing, albeit still small, group of worker cooperatives forging more equitable worker-centered ways of organizing health and care work.

A new collection of nine case studies involving 13 cooperatives, published earlier this year by Rutgers University’s Institute for the Study of Employee Ownership and Profit Sharing, offers a close examination of worker cooperatives in the US healthcare sector. Three of the cases involved home care co-ops, three involved professionalized health practices, and three offered case studies of co-op efforts that had broader goals of changing industry structures. The case study collection was co-authored by Minsun Ji, Camille Kerr, Sanjay Pinto, and myself—with an introduction co-authored by Adrienne Eaton, dean of the Rutgers School of Management and Labor Relations.  

Below I offer highlights from two case studies—one involving a physical therapy cooperative and the other a set of home care co-ops—to illustrate some of the possibilities for more democratically organized care.

A Physical Therapy Co-Op in Vermont

Vermont’s PT360 is not only a successful worker-owned cooperative. It is the largest privately owned physical therapy clinic of any kind in the state of Vermont. 

The company started in 2010 with a single clinic and then rapidly grew. Today, it operates four facilities across Chittenden County, VT, the state’s most populous county, home to about 169,000 people. The firm has 36 employees. Its success proves that “worker cooperatives can make money,” says Deborah Harris, president and executive director of the cooperative.

As its name suggests, PT360 aims to give “360-degree” physical therapy by providing a wide variety of different therapeutic and rehabilitation services. In addition to aquatic therapy in its heated saltwater pools, other treatments include manual therapy, exercise, and training.

At PT360, as at many worker cooperatives, the net margin or surplus (the profit) is distributed to worker-owners based on time worked. Therefore, a senior physical therapist working 40 hours takes home the same profit share as a front desk employee working 40 hours. This makes PT360’s approach far more egalitarian than profit sharing is in conventional workplaces (in which profit sharing is often proportionate to salary levels, thereby reproducing wage inequality).  

“I think the difference with a cooperative really comes down to the vision-making role we have.”

Last year, the company expanded its parental leave benefit to include fathers and partners so that employees who are new parents, regardless of gender, receive paid time off. The way this policy change occurred illustrates something important about how worker cooperatives can give workers the ability to bring about policy changes that matter. 

At PT360, “Owner Meetings” take place every four to six weeks, at which every worker-owner’s perspective can be aired and every voice heard. Any worker-owner (or “cooperative member”) can add an item to the agenda. The members discuss and then vote on each agenda item. Decisions are made based on the majority rule.  

To physical therapist and co-owner Amy Sheridan, this is what makes working in a worker cooperative different from the clinics and hospitals where she previously worked.  

“I think the difference with a cooperative really comes down to the vision-making role we have. It comes down to the bigger policy decisions,” Sheridan says. “We discuss strategic planning; we discuss big picture questions about how we want to move forward as a company. We look at the next five years and decide we want to buy another clinic, open new clinic locations. That kind of big decision-making is made all together, with one vote per person. We all can present policy. We have committees to explore policy. We all vote on policy.” 

By comparison, in a hospital where she had previously worked: “Everything came top-down. You didn’t have any input. If they say, ‘You’re working later,’ you work later.” She also experienced working in a private practice where physical therapists did have input into how we would like the clinic to be run. Still, the two owners of the company made the final decision. “We could say, ‘Hey we think this should happen.’ But we had no real decision-making ability.” 

The “one person-one vote” quality of making decisions “levels the playing field” regarding policy decisions. “It really doesn’t matter what your title is, because everyone has one share and one vote,” explains Harris.  

How Policy Is Changed at PT360

In 2022, “we passed a parental leave policy that I had really pushed,” Amy Sheridan recalls. Earlier, women employees received 60 percent of pay for six weeks after having a child, and male or non-childbearing partners received no parental leave benefit at all. Sheridan was concerned: “We have a lot of new parents here, and we were going to lose them. We had lost a few.” 

Sheridan and other concerned worker-owners “formed a group to look at it and came up with ideas. We presented the ideas to the big group [at the Owner Meeting]. We all discussed it. We voted unanimously in January 2022 to change the policy….We said that not only do women need to have better parental leave, but our male counterparts need to too. That’s important. We came up with something equal across gender.” The new policy guarantees two weeks of fully paid parental leave for employees who are new parents—regardless of gender. That comes on top of the longer 60 percent paid maternity leave for employees who give birth.

This example of a worker-owner-initiated policy correction at PT360 illustrates something important: in a worker cooperative, the democratic structure gives worker-owners the ability to organize around the needs of current members. At PT360, Owner Meetings provide space for democratic deliberation over such matters as personnel policies and benefits that in many more traditional companies are decided wholly by a management team member, often without substantive input from workers. The cooperative structure provides mechanisms for worker-owner-initiated change. 

Deborah Harris recalls that the change in parental leave policy came in direct response “to the concerns voiced by current owners—they identified a gap where we were falling short and loudly vocalized a need for change.”

Might PT360 have pioneered a prototype that could be replicated? To our research team’s knowledge, PT360 is the only employee-owned physical therapy co-op in the United States. But of course, it is highly successful. And there are over 300,000 licensed physical therapists in the United States with 38,000 clinics worth $34 billion. The industry is increasingly important as the baby boomer generation ages; the use of physical therapy can dramatically lower overall patient treatment costs and offer aging patients a much better quality of life. Given the number of physical therapists searching for new business models and the importance of strengthening the job quality of practitioners and administrative staff in the industry, PT360’s structure and practices may offer lessons for others in the field. 

A Home Care Co-Op in Washington State

At Peninsula Homecare Cooperative in Washington State, all major decisions are made by member vote. Located in Port Townsend on the Olympic Peninsula, the worker cooperative has been in business since 2016. Cofounder and co-op administrator Kippi Waters saw a need for greater cooperation and organization among the area’s caregivers, having worked as an independent private caregiver for decades herself. “The word got to me that there were funds available through the USDA Rural Development program” for cooperatives, that could be used to start a cooperative for caregivers, she says. 

Peninsula is one of five home care cooperatives in Washington. The five worker cooperatives operate in different areas of the western part of the state: Bellingham, Olympia, Port Angeles, and Anacortes, in addition to Port Townsend. That puts them in close enough proximity to support one another—some have “loaned” caregivers to a sister cooperative in a neighboring county to help cover temporary staffing gaps—but at the same time, the co-ops are located far enough away from one another so as not to directly compete. 

No other state has as many individual home care cooperatives in operation as Washington; this cluster of five small, industrious, mutually supporting cooperatives in Western Washington is unique nationally.

In early 2022, Peninsula had 18 employees on the payroll, two-thirds of whom worked 40 hours per week. (The proportion working full time fluctuates.) Of the 18 employees, 14 bought ownership shares and are members of the cooperative. Peninsula has an intergenerational staff ranging in age from 29 years to 79 years. Earlier in its history, the members consisted mostly of older women, but now “the demographic of our staff is moving toward a younger age,” says Waters, with more of a gender mix as well. There were five men on staff in 2022.  

While the cooperative has an elected board of five worker members, at Peninsula all major decisions go to the full membership for a vote. That includes all significant financial decisions, including decisions to change the rates they charge clients or increase pay and decisions that might impact the cooperative culture. For example, the membership voted in 2022 to raise the hourly wage from $18 to $20 per hour in response to the rising cost of living.

The co-op has remained profitable since 2017, paying dividends to its members twice per year. As an example, in 2021, every member, part-time or full-time, received the equivalent of $6.50 per hour in patronage dividends, added to their $18 per hour wage. “So really, the members made $24.50 an hour…including profit shares,” Waters says. 

During the pandemic, Peninsula received two Paycheck Protection Program forgivable loans (which, of course, were effectively grants). Through a member vote, the member-owners decided how to allocate the funds democratically. The members voted to earmark funds from the first loan in 2020, to pay home care workers who had to quarantine due to strict coronavirus protocols and were unable to work and earn pay. It turned out, however, that there was little need for quarantine pay. Therefore, once the loan had been forgiven and became income on the books, the co-op was able to divide the funds and distribute them to the members.

Whereas in much of the economy workers had no direct say in how businesses they worked for used their PPP funds, at Peninsula and other Washington State cooperatives, the decision about how to allocate PPP funds was deliberated over democratically by the workers and tailored to need.

According to Waters, “The caregivers deserved that bonus because they got up every morning amid the fear that we all felt in 2020. March. April. May. June. When we first went into lockdown, the whole world was locked down, but we were getting up in the morning and driving down the empty streets to take care of our clients before masks were available. I understood how fearful it was for our staff. So, it was without even a hesitation that we distributed 100 percent of the PPP loan.”

 The story of Peninsula and the other area cooperatives confirms that small cooperatives operating in the face of structural headwinds can gain resilience from supporting one another. Peninsula is also able to thrive with the support, training, and resources of the Northwest Cooperative Development Center, which provides support to all five co-ops.

The experience of the Washington State network of home care cooperatives adds another data point to the accumulating evidence that home care businesses structured as worker cooperatives can, by design, center caregivers and improve respect, voice, working conditions, and pay. 

Reflections: The Future Prospects of Healthcare Cooperatives

The federal government projects overall employment in healthcare to grow 13 percent from 2021 to 2031, much faster than the average for all occupations, adding an expected two million new jobs. For its part, PHI reports that, “The home care workforce is projected to add one million new jobs from 2019 to 2029—more new jobs than any other occupation in the United States. This workforce will add more new jobs than fast food workers and cooks combined, which are ranked as second and third occupations with the most projected growth over the coming decade.” 

Nationally, home care work, broadly defined, is one of the nation’s lowest-paid occupations. PHI estimates about nine in 10 home care workers are women, more than half are people of color, and over one quarter were born outside the United States. In addition to poor pay, few benefits, and unpredictable schedules, the work carries significant safety risks and the potential for exploitation by employers and clients. 

Worker cooperatives are just beginning to take root in the health and care sectors. Some have long track records of success, while others are fledgling experiments. These organizations are nevertheless prototypes for demonstrating the potential for worker-centered approaches to health and care work more broadly. By their design, co-ops contrast with predominant business models in which ownership, profits, and governing authority are reserved for the few. In cooperatives, worker-owners share profits and make significant decisions democratically. 

Looking across the 13 worker cooperatives documented in the new case studies, two key features stand out:

First, cooperative governance practices allow an unusual degree of worker voice in these workplaces. Of particular interest is the inclusion of lower-paid clerical staff and support staff as worker-owners with an equal voice and vote in these settings. As the example of PT360’s “Owner Meetings” described above demonstrates, substantial worker voice and democratic process can serve and strengthen a successful practice. 

A second common feature of cooperative workplaces is their cultures of support. For BIPOC (Black, Indigenous, and people of color), immigrant, and marginalized workers who experience discrimination or risk abuse in conventional settings, cooperatives serve as spaces for mutual support and respectful treatment. Moreover, the case studies uncover preliminary indications that when health and care workers are themselves embedded in workplace support systems, they can better provide quality care to others.

Too often, these new jobs are low-paying jobs—and, moreover, jobs that don’t offer workers a meaningful say in the terms or conditions of their employment. But as the examples of PT360 and Peninsula Homecare—and the many other worker cooperatives in the Rutgers study—demonstrate, a better path forward is possible.