Health care for Wal-Mart employees costs state up to $8 million

Studies in MA, CT, GA, TN, WV, WI, WA show states also footing bill

for Wal-Mart’s employees

Montgomery, Ala. – Retail giant Wal-Mart tops the list of companies in Alabama that have employees with children on the state health care program for uninsured children funded by Medicaid, the Associated Press reported today. Alabama joins a growing list of states reporting Wal-Mart as the #1 or a top corporate beneficiary of its public health program.

“Despite the fact that Wal-Mart makes enormous corporate profits, the company is stingy when it comes to its employees’ health care benefits,” said AFL-CIO President John J. Sweeney. “When its employees must join public health rolls instead of getting affordable health care on the job, Wal-Mart is shifting the cost to taxpayers. That’s simply wrong.”

Although the nation’s largest retailer does offer health care coverage to its employees, waiting periods for employees to receive coverage are long, many employees’ hours are deliberately kept below 34 hours so they won’t qualify and the cost is too high to afford. According to a fall 2003 AFL-CIO study, the insurance premium for Wal-Mart family coverage was as high as $250 per month in 2004, a prohibitive expense for many of the retail giant’s low paid workers. .

According to the AP story, “Wal-Mart workers’ children account for 3,864 children on the [Alabama] Medicaid rolls at a cost between $5.8 million and $8.2 million.” The next highest employer of children on public rolls was McDonald’s, with 1,615 on Medicaid.

Georgia, Tennessee, Washington, Massachusetts, Wisconsin, West Virginia and Connecticut have also reported that children of Wal-Mart employees are a disproportionately large share of their state health rolls.

Currently, 26 states have introduced legislation to require states to disclose which employers are shifting health care costs to taxpayers. Championed by members of the National Labor Caucus of State Legislators, the legislation is designed to help measure the costs to state health care programs when large and profitable employers such as Wal-Mart skimp on coverage.

A 2002 Georgia state survey showed that 10,261 of the 166,000 children covered by PeachCare for Kids (a Georgia state health program) had a parent working at Wal-Mart. That’s 14 times the number for the next highest employer: Publix grocery store, with 734.

And in 2004, a University of California at Berkeley Labor Center study found that in California alone, the reliance of Wal-Mart workers on public assistance programs cost the state’s taxpayers $86 million annually. Health-related expenses made up $32 million of that number.

“Wal-Mart is hitting its employees with a one-two punch that keeps them in poverty: substandard wages and stingy benefits. And taxpayers are picking up the tab,” continued Sweeney. “Wal-Mart’s employees and consumers deserve better.”