Another State Takes Aim at Wal-Mart's Health Care

May 17, 2005 (, Pennsylvania's largest private employer, might not feel so welcome with the introduction of legislation aimed at defraying state health-care costs.

The bill states that companies who employ 20 or more individuals would be required to provide Pennsylvania with annual reports detailing how many employees are receiving Medical Assistance, according to a report in the Philadelphia Inquirer.

The company employs 40,000 Pennsylvanians, of whom a significant percentage receive taxpayer-subsidized care, instead of being covered by a plan offered to them through Wal-Mart, the report says, adding that some critics say such costs could reach $30 million annually.

“Wal-Mart is the most notorious abuser of Medical Assistance programs nationwide based on states that have done studies,” said Representative Mike Veon (D., Beaver), a cosponsor of the bill, in the Inquirer’s report “We need to find a way to encourage or require employers to provide affordable health-care insurance.”

Such bills “are nothing more than a political attempt by organized labor to make Wal-Mart less competitive in certain states,” said Nate Hurst, a Wal-Mart spokesman.

The company argues that more than half (56%) of its employees are covered by the employer-sponsored health insurance program, for which premiums begin at $40 a month for single workers and $155 for families, and the other 44% are covered by other plans, either public or private, the Inquirer reported. However the critics say that the plan has both a too high deductible of $1,000 and a waiting period that is too long (six months for full-time employees and two years for those employed part-time) to make the coverage accessible to those who need it.

Although Wal-Mart has been involved in a range of lawsuits over the past year, this appears to be the first time legislation is being enacted against the retail giant. Maryland’s General Assembly passed a similar proposal last month, one that would force employers with more than 10,000 employees to spend at least 8% of payroll on health benefits – or put the money directly into the state’s health program for the poor. Wal-Mart would allegedly be the only company affected by such legislation, which the governor has said he will veto (See Wal-Mart Questions MD Growth Because of Health Care Proposal ).

Last week, a bill was introduced in New Jersey, also appearing to target Wal-Mart, which employs 12,000 in the Garden State, mandating that companies with more than 10,000 employees have to choose between increasing their coverage of employees or paying $2.45 per worker per hour above wages into the state Medicaid program.

A bill has also been introduced in Connecticut ( CT Measure Proposes Health Coverage Requirements ), while a a similar measure approved by California lawmakers in 2003 failed to get voter approval (See Proposition on Company Health Coverage Waits on California Ballot ).