Wal-Mart To Expand Number Of Employee Health Care Plans

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Employee Health Care Plans

Wal-Mart Stores,the largest private employer in the U.S., on Tuesday announced a newhealth plan that seeks to reduce costs and expand benefits foremployees and offer workers generic medications for $4 each, the New York Times reports (Barbaro, New York Times,9/19). Under the plan, Wal-Mart employees will have the ability toselect from 50 combinations of deductibles, premiums and credits.

The plan will offer Wal-Mart employees:

  • Achoice between four annual deductibles of $350, $500, $1,000 or $2,000,with monthly premiums that begin at $5 and increase for lowerdeductibles;
  • "Credits" of $100,$250 or $500 in "credits" to help offset the cost of deductibles, withhigher premiums for workers who select higher credits;
  • Copayments of $4 each for 2,400 generic medications; and
  • Nolifetime caps on benefits for catastrophic care in most cases andannual caps on costs for workers after they pay annual deductibles of$2,000 or $5,000 (Appelby, USA Today, 9/19).

LindaDillman, executive vice president for benefits at Wal-Mart, said, "Weare removing any barriers of entry" for health insurance for employees,adding, "When you are talking about $8 a month and a $100 health carecredit, why would you not sign up?" (New York Times, 9/19).

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Inaddition, Wal-Mart spokesperson Sarah Clark said that the plan willreduce medication costs for employees by an estimated $25 million nextyear (Coleman-Lochner, Bloomberg/Houston Chronicle,9/18). Dillman said that the plan will increase health care costs forWal-Mart, although the increase will remain "in line" with those ofprevious years (Hudson, Wall Street Journal, 9/19).

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Experts said that the number of the 125,000 Wal-Mart employees withouthealth insurance who will enroll in the new plan remains undeterminedbut added that the plan will improve benefits for about 636,000 workerswith coverage. Ron Pollack, executive director of Families USA, said, "On face value, this looks like a very significant change and improvement."

Helen Darling, president of the National Business Group on Health, called the plan "a very good plan" (New York Times, 9/19). According to Dallas Salisbury, president of the Employee Benefits Research Institute, "Wal-Mart is moving in the direction of far more complete coverage at lower premiums with greater flexibility" (USA Today, 9/19).

David Nassar -- executive director of Wal-Mart Watch, a group funded by the Service Employees International Union -- said that the plan "shows signs of improvement" from a previous plan offered by Wal-Mart (Kabel,

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