Everyday Low Benefits: Health Insurance in the Age of WalMart

1
Everyday Low Benefits Health Insurance in the
Age of Wal-Mart

• The Center for a Changing Workforce
• Seattle, WA

2
What is the Changing Workforce?

• Contingent work is temporaryday labor, on-call,
  contract, and direct hire temps.
  
• Independent contractors part-time.
• Many permatemps 20 longer than 1 year.

3
Contingent and Nonstandard WorkArrangements
4
Nonstandard employment is growing

• 25 of workforceover 30 million workers.
• Temporary employment grew 90 1990-2005.
• Fastest-growingstaffing firms projected to add
  1.8 million new jobs 2002-2012.

5
Nonstandard Workers Lack Insurance

• 71 of standard workers have employer coverage
  vs. 14 of nonstandard workers.
  
• 35 of nonstandard workers are uninsured (any
  source).
  
• 47 were uninsured at some point in last year.

6
Future Health Insurance for Low Wage Workers?

• Employers and insurers have a new vision

7
Limited Benefit Insurance All Youll Ever Need?
8
Medical Discount Cards Dont leave home without
them?

• Medical Savings
• Members receive discounts at the time of service
  from participating hospitals, physicians,
  laboratories, rehab facilities, home health care
  and more.
• SAVINGS UP TO 60 at participating physicians
• SAVINGS UP TO 30 at participating hospitals
• Over 500,000 participating physician locations
• Over 66,000 participating Hospitals and Ancillary
  Facilities nationwide.

9
Supplemental insurance No insurance is complete
without it?

• Covers specific disease conditions (cancer) or
  supplemental cash.
  
• 13 of nonstandard workers with employer-coverage
  only have supplemental insurance.
  
• Very profitable for insurers and sales agents

10
How Employees Get Excluded from Health Insurance
at Work

• Employers segment workforce to exclude
  less-favored employees.

11
Payrolling creating a two-tier workforce

• Paying your employees through an outside agency
  to make it appear that the employees are not your
  employees.
  
• Labels contract workers, leased employees, and
  long-term temporaries.
  
• 2 million payrolled employees.

12
How Payrolling is Sold to Employers

• COMFORCE has helped some clients cut labor costs
  by as much as 50.
  
• Your Costs without Comforce

Your Savings with Comforce
13
Kelly Services less than 1 Insured?

• Kelly Services has approximately 525,000 US
  employees.
  
• Kellys DOL reports claim less than 5,000
  insurance participants.

14
Independent Contractors or Employees?

• Home Care Workers
• Labeling employees as franchisees or
  businesses
  
• Construction work using labor brokers.

15
Part-time workWal-Marts Example

• 300,000 part-time employees
• Work less than 35 hours a week
• Must wait 24 months
• No family coverage
• Starbridge mini-medical

16
UnderinsuranceWal-Marts Value Plan

• 1,000-3,000 basic deductibles pharmacy,
  in-patient, outpatient, etc.
  
• OOP Max 5,000-10,000 (plus 5,000 pharmacy)
• OOP Max 30 of average wage for indiv. plan,
  60 of average wage for family plan.

17
Wal-Marts Medicaid Subsidies

• Ranked 1st in 16 of 18 states for Medicaid and
  S-CHIP subsidies.
  
• Every new store means 100,000 annually in
  Medicaid costs.

18
Wal-Mart Example for other employers?

• Less than 40 coverage
• Wal-Mart pays only 59 of costs, less than
  competitors
  
• 25,000 cap first year.
• Home Depot similar coverage?

19
Federal Policy Options

• Increase access to employer-provided insurance.
• Clarify ERISA to address misclassification
  problem.

20
State Policy Options

• Large employer fair share legislation.
• Medicaid subsidy disclosure
• Limits to temporary employment.
• End mislabeling of public employees
• Crackdown on indep. contractor scams.
• Regulation of mini-meds and discount cards.