Wal-Mart Promises to Improve Health Care Coverage for Employees

For the second time in the past six months, the world’s largest retailer has announced plans to improve health benefits for employees. Wal-Mart Stores Inc., based in Bentonville, AK, came under attack last year for failing to provide adequate health insurance coverage for its employees.

At least 22 states filed bills demanding that the retailer be forced to spend more on health care. Maryland was the first state in the nation to require Wal-Mart to spend more on employee health care, or to pay the difference into the state’s Medicaid fund. The new law has been challenged in court by The Retail Industry Leaders Association. Washington state legislators considered a similar measure proposed by organized labor groups, but the bill was not passed earlier this month in the state House. Democratic Gov. Chris Gregoire has promised to work on fine-tuning the bill, in the hope that a new version will pass the state Legislature next year.

Wal-Mart Chief Executive Lee Scott issued a statement Thursday in advance of a speech he will give to the National Governors Association on Sunday. Scott’s speech will address the issue of the rising costs of health care and the need for a government-business partnership to find an answer to the problem. "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," Scott said in his statement. In his speech Sunday he is expected to renew Wal-Mart’s criticism of the state bills asking to force the company to increase benefits.

Last fall Wal-Mart offered new lower-premium insurance plans in order to get more of its work force enrolled in company plans. According to the company, the new benefits, offered in response to mounting criticism from organized labor and employee groups, helped get over 70,000 workers enrolled in Wal-Mart plans for the first time ever. Premiums for some workers are now as low as $11 to $23 a month. Scott’s statement said that the store is taking new steps to expand the $11 monthly premium to make it available to half of all U.S. employees by next year, as well as shortening eligibility periods for part-time workers and their children. Eligibility periods are currently 24 months, and the store is still deciding what the new periods will be.

As of January, Wal-Mart had 615,000 employees enrolled in company health plans, out of its 1.3 million employees in the United States. The retailer plans to expand a trial run of in-store clinics, which are aimed at providing lower cost non-emergency health care to the public. There are about a dozen such clinics now and the company has plans to expand that number to more than 50 stores this year. Several other retailers are testing the idea to provide the public with an alternative to long waits at doctor’s offices for minor ailments and certain routine tests.