(The following article originally appeared in the New York Times on November 1, 2004 and was written by Reed Abelson.)
NEW YORK — In the national debate over what to do about the growing number of working people with little or no health insurance, no other company may be taking more heat than the country’s largest employer, Wal-Mart Stores.
The company, despite its popularity with consumers, has grown accustomed to being accused of crushing Main Street merchants with its sprawling stores and low prices and of driving down wages for workers across the retail industry. And more than a million former and current female Wal-Mart employees are part of a sex discrimination lawsuit that the company is fighting.
Now, Wal-Mart finds itself under attack for what critics see as its miserly approach to employee health care, which they say is forcing too many of its workers and their families into state insurance programs or making them rely on charity care by hospitals.
Wal-Mart vigorously defends its health care policies, saying it offers affordable coverage for all employees.
The company says it has no way of knowing how many of its employees, whom it calls associates, or their families are insured under state programs. The larger issue of whether companies can and should absorb the soaring cost of health care is a national issue, said Susan Chambers, the executive vice president who oversees benefits at Wal-Mart. “You can’t solve it for the 1.2 million associates if you can’t solve it for the country.”
A survey by Georgia officials found that more than 10,000 children of Wal-Mart employees were in the state’s health program for children at an annual cost of nearly $10 million to taxpayers. A North Carolina hospital found that 31 percent of 1,900 patients who described themselves as Wal-Mart employees were on Medicaid, while an additional 16 percent had no insurance at all.
And backers of a measure that will be on California’s ballot tomorrow, which would force big employers like Wal-Mart to either provide affordable health insurance to their workers or pay into a state insurance pool, say Wal-Mart employees without company insurance are costing California’s state health care programs an estimated $32 million a year.
Meanwhile, in Washington State, where the insurance commissioner is pushing the legislature to adopt a law similar to the one on the California ballot, companies that struggle to compete with Wal-Mart while insuring most of their own workers have become openly critical.
“Socially, we’re engaged in a race to the bottom,” said Craig Cole, the chief executive of Brown & Cole Stores, a supermarket chain that employs about 2,000 workers in Washington and adjoining states and pays for insurance coverage for about 95 percent of its employees. “Do we want to allow competition based on exploitation of the work force?” he asked.
Wal-Mart, which disputes the California figures and says it cannot verify the Georgia and North Carolina data, says its employees are largely insured. It cites internal surveys indicating that 90 percent of its employees have insurance—many through means other than Wal-Mart’s coverage because they are senior citizens on Medicare, students covered by their parents’ policies or employees with second jobs or working spouses.
“We are doing everything we can to take care of our associates and not shift costs,” Ms. Chambers said.
The company has gone on its own offensive, saying last week that it was spending $500,000 to defeat the California measure, Proposition 72. The measure is opposed by many other businesses, particularly restaurants and retailers, and by Gov. Arnold Schwarzenegger, who asserts that it would impede the state’s economic recovery and lead to a loss of jobs.
Wal-Mart has also been running a television ad nationally that features a Wal-Mart worker whose company health insurance covered his toddler son’s treatments for life-threatening liver disease. “Without Wal-Mart,” the father says, “I don’t know that he would have made it.”
But critics say the reality for too many Wal-Mart workers and their families is no insurance—either because they are unable to meet the company’s eligibility requirements or because they cannot afford monthly premiums as high as $264 a month for family coverage on an $8-an-hour cashier’s wage. Wal-Mart says its employees make $10 an hour on average.