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State subsidy to Wal-Mart employees put at $12 million
Seattle Times Olympia bureau
OLYMPIA — It cost the state an estimated $12 million in 2004 to provide government-subsidized health care to Wal-Mart employees, according to a state Senate analysis released Tuesday.
The total was nearly double that amount if costs to federal taxpayers are included.
The new figures provide fresh ammunition for a labor-dominated coalition that is pushing for legislation that would force some big employers to spend more on health-care benefits and stop shifting those costs to the state.
"The numbers tell us why it's imperative that we act now," said Sen. Jeanne Kohl-Welles, D-Seattle, chairwoman of the Senate Labor, Commerce and Research and Development Committee.
Jennifer Holder, a regional spokeswoman for Wal-Mart, said the figures used in the analysis are outdated and probably flawed. She said the company has "significantly" improved its health plans since 2004.
"Taking this report and kowtowing to the unions is doing no one any good," Holder said.
The new analysis, prepared by Senate committee staff, is based on data from two confidential state reports that listed the top 20 companies that had the most employees receiving state-subsidized health coverage through Medicaid or the state's Basic Health Plan (BHP).
Wal-Mart came out on top of both lists, with 3,180 employees receiving Medicaid benefits for themselves or a family member and 456 more on the BHP. The company employs about 16,000 people in Washington.
Medicaid is a state-federal program that provides health coverage to families on welfare and children in low-income families. The Basic Health Plan, funded entirely by the state, mostly covers low-income adults.
Using average monthly costs for the two programs, the committee staff estimated the state spent about $11 million to cover Wal-Mart employees who received Medicaid benefits in 2004 and $1 million more for those on the BHP.
Democrats in the House and Senate are pushing 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.
A coalition of labor unions and health-care groups is pushing similar measures in more than two dozen states. So far, Maryland is the only place where they have succeeded in getting a bill approved. That law is being challenged in court.
The United Food and Commercial Workers International Union, which represents workers for most of Wal-Mart's biggest competitors, last week launched a $100,000 television ad campaign urging lawmakers to pass the legislation.
The new Senate analysis focused on four of the 20 companies listed in the confidential reports: Wal-Mart, Safeway, Fred Meyer and Target. The committee staff said the four likely would be affected by the Democrats' proposed legislation.
Safeway has roughly the same number of employees in Washington state as Wal-Mart, but in 2004 had less than half as many workers on state-subsidized health care. Its employees received nearly $6 million in state-subsidized health coverage, according to the analysis.
Fred Meyer employees received an estimated $3.6 million in state-subsidized health care, while Target workers received nearly $2.9 million.
Lawmakers said the true costs to taxpayers were probably much higher. They pointed out the analysis does not factor in the additional expense of providing Medicaid coverage to the employees' children.
And it is clear that companies like Wal-Mart make up only a fraction of the total cost to the state of providing health coverage to private employees.
Applying the same monthly averages used in the Senate analysis to all of the companies named in last month's confidential reports, the total cost to state taxpayers comes to nearly $77 million.
Holder said Wal-Mart has made repeated efforts to get more information from the state about the numbers behind the recent reports.
For instance, she said, Wal-Mart employs numerous people who get government-subsidized health coverage because they have a disability or are on the state's WorkFirst program for people working their way off welfare. She said it's unclear whether those employees are included in the reports.
"We've gotten zero answers on anything," Holder said. "It's very frustrating for us."
Ralph Thomas: 360-943-9882 or firstname.lastname@example.org
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