Walmart Raises Employee Healthcare Premiums by up to 36%

http://makingchangeatwalmart.org/2012/11/12/walmart-raises-employee-healthcare-premiums-by-up-to-36/

Posted on November 12, 2012 by jway

Walmart Raises Employee Healthcare Premiums by up to 36%; Places further Restrictions on Eligibility

As Walmart executives publicized an employee healthcare change that showcased no-cost spine and heart surgeries at select hospitals, managers delivered a different message to retail associates at their stores: your healthcare costs are going up, again. Premiums are set to increase by up to 36% next year, employees were told, adding to steep hikes they faced last year. In comparison, projections for large employer-sponsored health plans are expected to increase by only 5.5 percent, according to PricewaterhouseCoopers.

This time last year, Walmart substantially rolled back coverage for part-time workers and significantly raised premiums as reported in the New York Times. Already working for poverty paychecks as a result of low-wages and insufficient hours, many of the company’s 1.4 million employees and their families are already uninsured and rely on costly public healthcare programs. The costly new changes are pushing many more hard-working Walmart Associates to drop coverage – a concern that members of OUR Walmart, the nationwide organization of Associates calling for change at the company, have been speaking out about.

Dan Hindman, a four year Associate from Paramount, Calif. store, doesn’t know how he is going to manage the rising costs. “Last year, my monthly premium went up 33%, and this year it’s going up another 25%. I can barely afford the Walmart healthcare right now,” said Hindman. “But I don’t want to lose coverage for my son and me.”

Walmart workers with families are some of the hardest hit by the changes in the plan. The increases over the last two years have doubled family coverage. This year alone, workers with children are facing an increase of up to 36% and those with full family coverage are confronted with a hike of 32%.

“Walmart’s double-digit premium increases, increased deductibles and cutbacks for part-time employees seem really excessive given the company’s profits,” said Ross Eisenbrey, Vice President at the Economic Policy Institute. “These harsh benefit cuts are out of line with what’s actually required by the insurance market, which nationwide has had only single-digit cost increases. With wages and household incomes stagnant—as well as families still recovering from the recession—it’s a particularly bad time for a rich company like Walmart to be shifting more costs onto its employees.”

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In addition to the premium increases, Walmart has added a number of restrictions on eligibility to the plan that will significantly limit access to coverage, even at the unaffordable rates. Under the new plan, Associates hired after February 1, 2012 will need to average 30 hours a week to be eligible for healthcare, an increase from the 24-hour eligibility requirement that was put into place last year. Up until last year, all part time employees were able to purchase insurance after 365 days of employment.

Workers also face steep increases in out-of-pocket costs. Beyond the dramatic increases in premium costs, Walmart has drastically increased costs for out-of-network coverage. For the first time, Walmart has created different deductibles for in-network versus out-of-network care. Previously all monies spent counted toward the deductible.