Oh!pinion Rotating Header Image

corporate welfare

Walmart raising cost of its ‘always low prices’
by sticking taxpayers with health care bills

screwWalmart, the nation’s largest retailer, is at it again, transferring the cost of necessities for its always low-wage workers onto taxpayers.

A Huffington Post report says Walmart plans to start cutting the hours of some unspecified number of its 1.2 million U.S. employees to less than 30 per week, starting in January.

Walmart isn’t going to reduce work hours of people struggling to get by on already low incomes just to give them more time with their families. This move is all about shifting the health care cost of those workers to taxpayers — a backdoor form of corporate welfare.

An Obamacare provision excuses employers from providing health care benefits to workers regularly on the job less than 30 hours a week. At the same time, the American Affordable Care Act is making more Medicaid money available to states, in a good-faith effort to ensure more low-income and no-income Americans have access to health care.

By reducing work hours of its employees, Walmart clearly intends to shift their health care costs to Medicaid, a program intended for the poorest Americans, including those unable to work at all.

This isn’t a new maneuver for Walmart. A 2011 New York Times story details how the retail giant instituted cuts in eligibility while limiting coverage and drastically raising premiums prices and deductibles.

.

Citing rising costs, Wal-Mart, the nation’s largest private employer, told its employees this week that all future part-time employees who work less than 24 hours a week on average will no longer qualify for any of the company’s health insurance plans.

In addition, any new employees who average 24 hours to 33 hours a week will no longer be able to include a spouse as part of their health care plan, although children can still be covered.

This is a big shift from just a few years ago when Wal-Mart expanded coverage for employees and their families after facing criticism because so many of its 1.4 million workers could not afford or did not qualify for coverage — rendering many of them eligible for Medicaid.

. . .In Wal-Mart’s 2012 health offerings, premiums will increase for some plans by more than 40 percent, although many of their workers pay relatively low premiums in comparison to more generous plans offered by other employers. But many Wal-Mart employees complain that their low premiums are accompanied by high deductibles that sometimes exceed 20 percent of their annual pay.

. . . Barbara Collins, a sales associate at the Wal-Mart in Placerville, Calif., said that the premiums for the H.M.O. plan for herself and her 5-year-old son would rise to $18 every two weeks from $10. Her big concern, she said, was that her deductible would jump to $5,000 a year, from $1,000 — a daunting amount considering she earns $19,000 a year. “I don’t know how I’ll be able to afford it if I go to a doctor or to physical therapy,” she said.

.

The story notes Walmart also cut by half the $1,000 it had been putting into employee health care savings accounts, alternative plans that help some employees with costs not covered by inurance. The company had encouraged use of the health savings program, which is cheaper for it than health insurance.

Last July, Sen. Bernie Sanders, I-Vt., tweeted that the Walton family has more wealth — $102.7 billion in 2010 — than the bottom 40 percent of American families. Politifact checked that out and judged the statement to be true. Here’s what that looks like per the six Walton heirs to make the Forbes 400 list (all amounts in billions):

Christy Walton, $25.3; Jim Walton, $23.7; Alice Walton, $23.3; S. Robson Walton, $23.1; Ann Walton Kroenke, $3.9 billion; and Nancy Walton Laurie, $3.4 billion.

From Wikipedia’s Walmart entry: “For the fiscal year ending January 31, 2011, Wal-Mart reported a net income of $15.4 billion on $422 billion of revenue with a 24.7% gross profit margin.”

Walmart CEO Michael Duke’s 2011 total compensation was $18.7 million, according to Marketwatch.

Our bottom-line impression: Walmart can well afford to provide high-quality, affordable health insurance to all its employees, without cutting the payroll or workers’ hours. And after doing that, the Walton clan would still have more wealth than needed to live in splendor for 100 lifetimes each. The company’s CEO and executives would be in no danger of impoverishment either.

There’s only one way to describe Walmart’s treatment of workers and shifting of costs to taxpayers: raw greed.

.