Friday, January 13, 2006

Wal-Mart Forced to Pay Fair Share

from The League: Reassembled

The Bloomberg Asia news service reported the state "Senate today voted to override a veto of the 'Wal-Mart bill' requiring companies with more than 10,000 employees to pay for some health-care benefits." Around 8pm, the House of Delegates followed the upper chamber's lead and defeated Ehrlich's veto of a bill that promises to improve quality-of-life for thousands of Marylanders who work for Wal-Mart and reduce our state's enormous subsidies of Wal-Mart.

The measure, officially known as the Fair Share Health Care Act, will ensure that deserving Wal-Mart employees would be provided with some level of health insurance coverage. Currently, Wal-Mart fails to provide its Maryland employees adequate benefits. While most large businesses cover 68% of employees, Wal-Mart provides coverage to only 48%. And those who do receive coverage are dealt a raw deal. On average, the retail giant's per-employee expense is only $3,100, compared to $4,800 spent by comparable businesses. (Although these statistics refer to Wal-Mart nationwide, there is no reason to assume a different picture in Maryland.)

The legislation will not only help Wal-Mart employees, but Maryland tax payers as well. Because Wal-Mart's health package is so lacking, many of its employees end up on the welfare rolls. As a result, Marylanders pay for coverage because their employer refuses to do so. The cost to Marylanders remains uncalculated, a November 2004 New York Times story documented the costs to other states: "A survey by Georgia officials found that more than 10,000 children of Wal-Mart employees were in the state's health program for children at an annual cost of nearly $10 million to taxpayers. A North Carolina hospital found that 31 percent of 1,900 patients who described themselves as Wal-Mart employees were on Medicaid."

Wal-Mart's irresponsible attitude towards employee health care is despicable and demands government action. Gov. Ehrlich should be ashamed of himself for vetoing the Fair Share Health Care Act. We're lucky to have a legislature assertive enough to right Ehrlich's wrong.

The legislation will not only help Wal-Mart employees, but Maryland tax payers as well. Because Wal-Mart's health package is so lacking, many of its employees end up on the welfare rolls. As a result, Marylanders pay for coverage because their employer refuses to do so. The cost to Marylanders remains uncalculated, a November 2004 New York Times story documented the costs to other states:"A survey by Georgia officials found that more than 10,000 children of Wal-Mart employees were in the state's health program for children at an annual cost of nearly $10 million to taxpayers. A North Carolina hospital found that 31 percent of 1,900 patients who described themselves as Wal-Mart employees were on Medicaid."

Wal-Mart's irresponsible attitude towards employee health care is despicable and demands government action. Gov. Ehrlich should be ashamed of himself for vetoing the Fair Share Health Care Act. We're lucky to have a legislature assertive enough to right Ehrlich's wrong.

from The League: Reassembled

1 Comments:

Blogger Matt Johnston said...

You wrote this:

The measure, officially known as the Fair Share Health Care Act, will ensure that deserving Wal-Mart employees would be provided with some level of health insurance coverage. Currently, Wal-Mart fails to provide its Maryland employees adequate benefits. While most large businesses cover 68% of employees, Wal-Mart provides coverage to only 48%. And those who do receive coverage are dealt a raw deal. On average, the retail giant's per-employee expense is only $3,100, compared to $4,800 spent by comparable businesses.

Let me pose a few questions.
1. How many "comparable businesses" are out there? Wal-Mart is far and away the single largest private employer in the country, perhaps even the world.

2. Of the 52% of employees alledgedly not covered by Wal-Mart, how many are part-time employees? How many are students probably still on Mom and Dad's insurance? I don't know, but the status of employment often indicates whether a person is eligible for employer provided health insurance.

3. Wal-Mart in general employs a lot of very young people, whose health care costs are generally pretty low and a lot of elderly people who automatically qualify for Medicare. Thus their per-employee health care costs are kept low. According to Wal-Mart's own employment statistics, the company employs 1.3 million workers. By your $3,100 per person payout, that equates to $4.03 billion dollars in health care spending. That is more than most companies make in a single year in gross revenue. True $4.03 billion is only about 1.5% of their sales, but remember Wal-Mart is not in the business of providing health care, it is in the discount retail business and if they can keep labor costs down, they keep prices down.

Finally, 85% of Americans still shop at Wal-Mart. Could Wal-Mart provide more health benefits, sure, but at what cost to the consumer?

2/01/2006 02:31:00 PM  

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