Wal-Mart To Expand Employee Health Coverage
Wal-Mart on Thursday issued a press release announcing that it will expand its employee health benefits and add 50 in-store clinics, USA Today reports (Appleby/Grant, USA Today, 2/24). The company said it will significantly reduce the two-year waiting period for part-time workers to qualify for health benefits, but it did not specify the new waiting time, the New York Times reports.
In addition, Wal-Mart said it will allow part-time workers to enroll their children in the employee health insurance plan. Wal-Mart also said it will expand its Value Plan -- under which employees can purchase coverage for as low as $11 per month in some areas -- to half of its employees by 2007. The plan allows three generic prescriptions and three doctor visits before implementing a deductible, which is $1,000 for an individual and $3,000 for a family.
The company currently insures fewer than half of its 1.3 million U.S. employees (Barbaro, New York Times, 2/24).
Wal-Mart CEO H. Lee Scott will formally announce the changes on Sunday at a meeting of the National Governors Association, and the company will provide more detailed information regarding the complete package over the next several months, the Washington Post reports (Mui, Washington Post, 2/24).
According to the Times, "Without ... details, it is unclear whether the latest changes will move Wal-Mart employees off state Medicaid rolls and onto Wal-Mart's insurance plans" (New York Times, 2/24). USA Today reports that many of the proposals "are not new" and were "included in a memo leaked to the press" in 2005.
The announcement "comes as about 22 states consider laws that could force Wal-Mart ... to pay more on health care for its workers" USA Today reports. Maryland already has done so (USA Today, 2/24).
In his speech, Scott is expected to "denounce those efforts," the Los Angeles Times reports (Goldman, Los Angeles Times, 2/24). Scott also is expected to request that state lawmakers work with businesses to find health care solutions. He said in the release, "The soaring cost of health care in America cannot be sustained over the long term by any business that offers health benefits to its employees," adding, "We have to do it together" (Cox/Baltimore Sun, 2/24).
Wal-Mart also announced that it will establish health clinics that will treat both employees and customers in more than 50 U.S. stores, the Wall Street Journal reports (Hudson, Wall Street Journal, 2/24). The company in 2005 opened clinics in nine stores in Oklahoma, Indiana, Arkansas and Florida. According to Cox/Sun, the clinics are run by an outside company and staffed by nurse practitioners, who provide nonemergency care to uninsured patients for $45 to $65.
Wal-Mart said three of the clinics in Arkansas have treated more than 4,300 patients, about half of whom were uninsured (Cox/Baltimore Sun, 2/24).
Mona Williams, spokesperson for Wal-Mart, said, "This is a way to offer medical care ... that is accessible and affordable" (USA Today, 2/24).
Williams said, "We think these enhancements are a step in the right direction for associates but don't yet know how they affect" enrollment.
Paul Ginsberg, president of the Center for Studying Health System Change, credited Wal-Mart for expanding health care during a time when many employers are cutting coverage, but he added that the company was "clearly focused on what it can do to look better without it costing them a lot more money."
Helen Darling, president of the National Business Group on Health, said the changes are "a very big development," adding, "If this takes off, it will have an impact on everyone. A lot of other organizations will jump into it" (New York Times, 2/24).
Chris Kofinis, communications director for Wake Up Wal-Mart, said, "All we know is that again and again, Wal-Mart will say one thing and do the opposite" (USA Today, 2/24).
Don Gher, chief investment officer at Coldstream Capital Management, said, "It's either an olive branch to acknowledge that they need to do more or others might view it as throwing down the gauntlet for government and business to work together" (Katz, Bloomberg/Boston Globe, 2/24).