Walmart, an Obamacare Supporter, Drops Coverage for Another 30,000 Employees

Obamacare by from The Weekly Standard, October, 9, 2014

In 2009, Walmart, the left-wing think tank Center for American Progress, and the Service Employees International Union, wrote a pro-Obamacare letter touting “the promise of reduced health care cost increases” that would come from “health care reform.”  Walmart and friends wrote, “We are for shared responsibility,” opined that “health care costs more because we don’t cover everyone,” and said that “losing coverage pushes people already dealing with financial hardship to the verge of financial collapse.”  Now Walmart has dumped another 30,000 part-time workers’ insurance plans, thanks to higher costs brought on by Obamacare.

Walmart already dropped coverage for some part-time employees back in 2011, a year and a half after Obamacare’s passage.

The Wall Street Journal reports on the newest round of cuts:

“Wal-Mart Stores Inc. is cutting health insurance for another 30,000 part-time workers and raising premiums for its other employees, as U.S. corporations push to contain costs in the wake of the federal health-care law.

“Autumn is typically when U.S. companies unveil changes to employee insurance plans. This is the first such enrollment period since employers could assess the full financial impact of the federal health-care overhaul.”

The Journal continues:

“‘We can’t take our eyes off costs,’ said Sally Welborn, senior vice president of global benefits at Wal-Mart. Ms. Welborn declined to say how much Wal-Mart will save from the plan changes.”

This is a far cry from what Walmart wrote in its letter five years ago.  At that time, it wrote, “From a business perspective, health reform could not be more critical.  A majority of Americans — 158 million — receive their coverage through their job of their spouse’s job, according to the Kaiser Family Foundation.  But few businesses will be able to keep up the pace at which premiums are rising.”

Walmart’s rosy prediction that costs would be contained as a result of “health reform,” and the “good ideas” that President Obama had “put forward,” have proven to be fanciful.  According to the Journal, many part-time employees who liked their plans haven’t been able to keep their plans:

“Several other retailers already have moved away from providing health insurance to part-time workers. Target Corp. earlier this year said it would stop offering such benefits, citing options available through public [Obamacare] exchanges. Home Depot Inc. last year ended health-care coverage for almost 20,000 part-time workers, while United Parcel Service Inc. cut coverage for workers’ spouses who had access to insurance through their own employers….

“Wal-Mart also is raising premiums for all workers next year. About 40% of enrolled workers are on its least expensive and most popular plan and will now pay $21.90 per two-week pay period, a 20% increase, starting Jan. 1. Across all three plans, Wal-Mart said it estimates workers will pay an additional $10 a pay period. The average Wal-Mart hourly worker earns $11.81 an hour.

“‘Half of my paycheck is gone before I even get the money,’ said BJ Marhefka, 49 years old, who works about 40 hours a week in the Wal-Mart automotive department in Southport, N.C., and makes $10 an hour.”

It seems that Obamacare’s detested individual mandate has helped drive costs upward:

“For Wal-Mart, [a] push from the individual mandate contributed to an influx of workers who signed up for coverage, jacking up costs. Wal-Mart, the country’s largest private employer, with about 1.4 million employees, forecasts that its health-care costs will rise by $500 million more than it had expected in the year ending Jan. 31, 2015.”

That same individual mandate will now coerce many of those who lost their plans to buy insurance through the Obamacare exchanges.  There, taxpayers will often help pick up the tab — rather than Walmart, whose revenues are greater than any other company in America.

Indeed, the Journal writes, “Wal-Mart has retained a third-party benefits adviser to help affected workers find coverage on public and private health exchanges or by using a spouse or partner’s health insurance.”

“‘We can’t predict where they will go, but we are going to help them find affordable health care,’ Ms. Welborn said.”

Maybe it’s time to repeal Obamacare and replace it with a conservative alternative that would lower costs, secure liberty, and make sure that any American who wants to buy health insurance would be able to do so.

 © 2014 Weekly Standard LLC. Reprinted with permission.