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Tuesday, January 24, 2006 - Page updated at 10:22 AM

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More than 3,100 Wal-Mart workers got state health aid

Seattle Times Olympia bureau

OLYMPIA — More than 3,100 Wal-Mart employees in Washington were benefiting from state-subsidized health coverage throughout 2004 — nearly double the total for any other company, according to two confidential state reports.

That total is much higher than previously thought. And it indicates that as many as 20 percent of Wal-Mart's employees were getting taxpayer-funded health care for themselves or their dependents.

The reports are sure to fuel the debate over a labor-backed push in the Legislature to require companies such as Wal-Mart to pay more for health care. Democrats in the House and Senate say the reports show that Wal-Mart and some other big companies are shifting millions of dollars in health-care costs to the state.

"I think taxpayers should be outraged," Rep. Steve Conway, D-Tacoma, said Monday. "They are subsidizing one of the wealthiest corporations in the world."

Amy Hill, a spokeswoman for Wal-Mart, said the company has no information that would confirm or refute the state's findings. But she said the data are more than a year old and might no longer be accurate.

"We implemented a lot of new plans last fall that we believe may appeal to people who had chosen to not take our coverage," Hill said.

Citing state and federal confidentiality rules, the state last month provided the new reports to only a handful of legislators and legislative staff members. But copies were leaked to The Seattle Times.

Medicaid is a state-federal program that provides health coverage to families on welfare and children in low-income families. The Basic Health Plan (BHP), funded entirely by the state, mostly covers low-income adults.

Both programs are aimed primarily at people in families with incomes below 200 percent of the federal poverty level. That would mean a family of four with an income of about $38,000 would be eligible.

The new reports lists companies that in 2004 had the most employees receiving benefits under the programs.

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Wal-Mart came out on top of both lists, by wide margins.

One report shows that, throughout 2004, an average 3,180 Wal-Mart employees were receiving state-funded medical assistance, including Medicaid, for themselves or for a dependent. The other report shows that 456 Wal-Mart employees were on the state's Basic Health Plan that year. Some employees may be counted on both of the lists.

McDonald's restaurants had the second-highest total, with an average 1,824 employees receiving Medicaid benefits in 2004.

Safeway was next, with 1,539 employees on Medicaid and 173 employees on the BHP.

With about 16,000 employees each, Wal-Mart and Safeway are among the state's largest employers. McDonald's has about 12,000 employees in Washington, but they work for 45 separately owned franchises or at one of 62 outlets the corporation owns.

The companies with the highest totals of employees on Medicaid and the BHP were concentrated mostly in a few industries, including general-merchandise stores, groceries and fast-food chains. Several companies that recruit and hire out temporary workers or day laborers — such as Express Personnel Services and Labor Ready Northwest — also ranked high on both lists.

Lawmakers said one of the most startling findings in the new reports is that more than half of the Wal-Mart employees who received Medicaid benefits — nearly 1,800 — were full-time workers.

For nearly all of the other companies listed, the vast majority of employees on Medicaid were part-time workers.

"It shows Wal-Mart isn't even taking care of its full-time employees," said Rep. Eileen Cody, D-Seattle.

But Cody and Conway said the reports shine a light on other companies as well.

"It's not just Wal-Mart," Conway said. "A lot of low-cost employers are shifting their health-care costs to the state."

Neither of the reports makes any attempt to calculate how much it cost the state to cover the employees and their families. But it's clearly in the tens of millions of dollars.

Wal-Mart defends its employee health benefits as competitive and affordable.

Hill, the Wal-Mart spokeswoman, said the company recently put in place a new "value" health plan for its employees. Under that plan, employees get 100 percent coverage for their first three doctor visits each year and after that must pay a $1,000 deductible. She said the plan's employee premiums average $23 per month.

Still, Wal-Mart's latest estimates show that only about half of its employees are on one of the company health plans. And, in an internal company memo leaked last fall, Wal-Mart acknowledged that, nationwide, nearly half of its employees' children were either on Medicaid or were uninsured.

More than a dozen other states have conducted studies to identify companies with the most employees on government-subsidized health care. In nearly every case, Wal-Mart came out on top.

Democratic lawmakers in Olympia hope to pass legislation that would require companies with 5,000 or more employees to put at least 9 percent of their payroll costs toward health-care benefits. Similar legislation was approved earlier this month in Maryland.

It's all part of an effort by a coalition of labor unions and health-care groups to push for so-called Wal-Mart bills in more than 30 states.

Wal-Mart says the legislation is "purely political" and would do nothing about the soaring cost of health care.

Hill told lawmakers in Olympia last week that the company didn't know what percentage of payroll it spends on health benefits.

To help lawmakers here prepare for the debate, Gov. Christine Gregoire last year requested the two new reports even though she knew her agencies would not be allowed to release the results to the public.

Copies stamped "confidential" were sent last month to about a half-dozen legislators, several legislative staff members and the governor's health-policy adviser. To produce the reports, the state matched its Medicaid and BHP recipient lists with employee data compiled by the state Employment Security Department. But Employment Security officials say they are barred from publicly releasing any data that reveal company names. The rankings in the new reports are similar to what lawmakers saw three years ago in a report that the state now says was improperly released to the public.

But the totals in the new reports — especially for numbers of employees on Medicaid — are much higher than before. The old report, for instance, indicated only 450 Wal-Mart employees were receiving Medicaid benefits, compared to more than 3,100 now.

It's unclear why the new numbers are so much higher, but lawmakers speculated the state did a more thorough job of gathering data this time. Officials at the Employment Security Department declined to comment.

Ralph Thomas: 360-943-9882

Copyright © 2006 The Seattle Times Company

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