Report: Walmart plans to deny health care benefits to new employees

Why the ACA can’t kick in soon enough, part the infinite: the Huffington Post is reporting that, according to a new policy that will take effect in January, Walmart will begin denying health insurance to new employees who work less than 30 hours a week. It will also reserve the right to cut health benefits for certain groups of current employees who work less than 30 hours. Walmart workers, like many retail employees, often have shifts and hours that vary from week to week, according to seasonal business cycles, so even workers who are currently working 30 hours or more could be affected.

Let’s not forget that Walmart is the nation’s largest private employer, so this change is hugely important. And it’s important not only in itself, but in the spillover effect it could have on the employment policies of comparable retailers.

The Huffington Post observes that the point of the new policy is to opportunistically take advantage of certain aspects of Obamacare:

Among the key features of Obamacare is an expansion of Medicaid, the taxpayer-financed health insurance program for poor people. Many of the Walmart workers who might be dropped from the company’s health care plans earn so little that they would qualify for the expanded Medicaid program, these experts said.

“Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured,” said Ken Jacobs, chairman of the Labor Research Center at the University of California, Berkeley.

This is yet one more example of why last week’s historic worker protests against Walmart were so important. I’ll add this reminder: it doesn’t have to be this way. Some highly profitable players in the retail game which are comparable to Walmart, such as Costco, manage to treat their workers decently. The reason Walmart runs its business in such a reprehensible manner is because it actively chooses to do so.

Kathleen Geier

Kathleen Geier is a writer and public policy researcher who lives in Chicago. She blogs at Inequality Matters. Find her on Twitter: @Kathy_Gee