Beginning Jan. 1, 2007, the retail giant Wal-Mart will cut health care coverage options for newly hired workers. This is yet another step in the Wal-Mart-led corporate race to shift the costs of health insurance onto workers. And it offers a window into the health care crisis facing workers across the country.
Wal-Mart’s new plan, called the “Value Plan,” is a low-premium, high-deductible plan. It will be the primary of three
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A premium is a monthly payment of a flat sum that workers make to maintain health plans. Often this money is taken out of the workers’ pay check by the employer to pay for the costs of maintaining the plan.
A deductible is the amount of money workers must pay over and above their monthly premium for medical expenses before the health insurance plan kicks in and begins to pay. The deductible must be “met,” or paid by the insured, before the benefits of the plan can apply.
Some of Wal-Mart’s 1.3 million store-level workers already use the plan. Under the plan, workers will pay a seemingly modest premium, as low as $11 per month, but will pay a massive deductible of $1,000. Employees can visit the doctor three times and fill three prescriptions for generic drugs each year before the high deductible kicks in.
The $1,000 general deductible is not the only major cost associated with the plan. It also establishes separate deductibles of $1,000 for inpatient hospital stays, $500 for each outpatient surgical visit and $300 for pharmacy purchases.
A premium of $11 per month may sound reasonable to some, especially younger workers or workers without current health problems. But, at bottom, it is terrible. It is a health plan that is affordable for people who do not get sick; for those who do not need a health plan. This is to say, in reality, it is not a health plan at all.
Once a worker gets sick and the deductible kicks in—whether from hospital stays, doctor visits, emergency room visits, pharmacy purchases or otherwise—the costs do too. The $11 premium effectively becomes a $500, $1,000 or $2,000 premium for that month. The full amount of which must be absorbed by the ailing worker. Most of Wal-Mart’s store-level workers make scarcely above minimum wage.
The aggregate costs then become more than Wal-Mart’s other current high-cost, low-coverage health plans.
The “Value Plan” is the result of a calculated risk-based analysis carried out by Wal-Mart executives. Wal-Mart is hedging its bets with health insurance companies. It is betting on its employees’ health in order to cut overhead costs and enrich themselves. And it is forcing workers to bet on their health and that of their families too.
Deeper health care crisis
This attitude is nothing new. Wal-Mart is well known for its low wages and lack of health and retirement benefits. Despite the tens of billions its owners rake in each year, most Wal-Mart workers make little over minimum wage and at least 46 percent have no health insurance at all.
Those workers who do have company-provided health benefits already pay a high price to maintain them.
Workers at Wal-Mart starting before 2007 may have the “Value Plan,” but most have other plans with higher premiums and much lower deductibles. The company will also make it harder for these workers to keep their plans. They are increasing premiums by an average of eight percent—higher than the average increase I premiums for U.S. employer-sponsored plans in the past year.
Wal-Mart wants all of its employees to have the “Value Plan.” And by increasing already high premiums, the company is likely to get what it wants. Workers who want lower deductibles are increasingly unable to afford the rising cost of premiums. So, the “Value Plan” is really a “value” only to Wal-Mart, and not to the workers it supposedly covers.
Wal-Mart is an egregious capitalist conglomerate. The whole capitalist class, especially the retail industry, looks to its actions regarding workers’ wages and benefits because they have a big effect on industry trends.
But the fight for access to health care goes far beyond Wal-Mart. Under the capitalist health care system, the goal is to generate profits—for insurance providers, hospitals, banks and more. Health care in the United States is a commodity. Health care decisions are made not on the basis of individual or social needs. Instead, private profit drives all aspects of health care in the U.S.
Corporations like Wal-Mart play a key part in this profit-making machine, but their main goal lies with curtailing their own health care costs. As long as they do not have to pay much, if anything at all, for employee health plans, labor costs get pushed down and profits can flow directly into the owners’ pockets.
Wal Mart is spending limitless funds to prevent union organization among its work force. The health care system in the United States is broken and the bosses want to shift the entire burden on to the backs of workers. Wal Mart workers need a strong union. Without which, they will be at the mercy of these cold-hearted capitalists who always put profits first.
