Walmart Raises Employee Healthcare Premiums by up to 36%

Posted by on Nov 12, 2012 in Press Releases, Walmart Watch Blog | 29 Comments

Walmart Raises Employee Healthcare Premiums by up to 36%; Places further Restrictions on Eligibility

Workers Distressed over Increases to Family and Individual Coverage that Far Outpace National Averages and Add to Unprecedented Increases Put into Effect Last Year

WASHINGTON—As Walmart executives publicized an employee healthcare change that showcased no-cost spine and heart surgeries at select hospitals, managers delivered a different message to retail associates at their stores: your healthcare costs are going up, again. Premiums are set to increase by up to 36% next year, employees were told, adding to steep hikes they faced last year.  In comparison, projections for large employer-sponsored health plans are expected to increase by only 5.5 percent, according to PricewaterhouseCoopers.

This time last year, Walmart substantially rolled back coverage for part-time workers and significantly raised premiums as reported in the New York Times.  Already working for poverty paychecks as a result of low-wages and insufficient hours, many of the company’s 1.4 million employees and their families are already uninsured and rely on costly public healthcare programs.  The costly new changes are pushing many more hard-working Walmart Associates to drop coverage – a concern that members of OUR Walmart, the nationwide organization of Associates calling for change at the company, have been speaking out about.

Dan Hindman, a four year Associate from Paramount, Calif. store, doesn’t know how he is going to manage the rising costs.  “Last year, my monthly premium went up 33%, and this year it’s going up another 25%. I can barely afford the Walmart healthcare right now,” said Hindman.  “But I don’t want to lose coverage for my son and me.”

Walmart workers with families are some of the hardest hit by the changes in the plan.  The increases over the last two years have doubled family coverage.  This year alone, workers with children are facing an increase of up to 36% and those with full family coverage are confronted with a hike of 32%.

“Walmart’s double-digit premium increases, increased deductibles and cutbacks for part-time employees seem really excessive given the company’s profits,” said Ross Eisenbrey, Vice President at the Economic Policy Institute. “These harsh benefit cuts are out of line with what’s actually required by the insurance market, which nationwide has had only single-digit cost increases. With wages and household incomes stagnant—as well as families still recovering from the recession—it’s a particularly bad time for a rich company like Walmart to be shifting more costs onto its employees.”

Barbara Andridge, an eight-year Associate from Placerville, Calif. was hit hard last year when premiums and deductibles increased.  Of the news, she said, “I couldn’t believe the increases last year and how much I had to pay out-of-pocket before my insurance started kicking in.  I just couldn’t afford another hike this year. Walmart just doesn’t understand what’s really going on for the workers that keep the company’s doors open.  That’s why OUR Walmart is working to make sure our voices are heard.”

OUR Walmart members have been calling for changes at the company, including access to affordable healthcare, that will help workers, families and communities.  In just one year, OUR Walmart has grown from an organization of 100 workers to a national organization of thousands of employees from 43 states.  Earlier this month, workers from more than a dozen cities walked off the job in protest of the retaliation that workers have been facing for speaking out about issues such as healthcare, scheduling, customer service and safety issues.  Elected officials, community leaders and workers held protests at more than 200 Walmart stores across the country and committed to joining workers to stop the retaliation and to reclaim Black Friday for Walmart workers and their communities by engaging in a wide range of non-violent activities on and leading up to Black Friday, including rallies, flash mobs, direct action and other efforts to inform customers about the illegal actions that Walmart has been taking against its workers.

Karin Aubrey-Sullivan, a 54-year old Walmart Associate from Cape Canaveral, Fla. store, says the increases mean healthcare premiums could now eat up one-third of each of her paychecks. “I am scared to death now with the insurance changes for 2013,” she says. “The rates have gone up again, and the deductibles have both been increased. I have developed some health issues over the past couple of years so I really need to carry insurance, but I just don’t know how I’ll cover the costs.”

In addition to the premium increases, Walmart has added a number of restrictions on eligibility to the plan that will significantly limit access to coverage, even at the unaffordable rates.  Under the new plan, Associates hired after February 1, 2012 will need to average 30 hours a week to be eligible for healthcare, an increase from the 24-hour eligibility requirement that was put into place last year. Up until last year, all part time employees were able to purchase insurance after 365 days of employment.

Workers also face steep increases in out-of-pocket costs. Beyond the dramatic increases in premium costs, Walmart has drastically increased costs for out-of-network coverage. For the first time, Walmart has created different deductibles for in-network versus out-of-network care.  Previously all monies spent counted toward the deductible.

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29 Comments

  1. Anonymous
    November 13, 2012

    And the Waltons continue to make billions!

    Reply
  2. Obama Nation
    November 13, 2012

    Thanks to obamacare, healthcare is just starting to get expensive!

    Reply
    • Obama Nation
      November 13, 2012

      The greatest part about this is everyone wanted obamacare, I guess people need to start reading the fine print of documents… Don’t be complaining this will happen everywhere thanks to the democrats of America.

      Reply
      • Anonymous
        November 14, 2012

        The saddest part of the whole ObamaCare deal is the new standard of full time is 30 hours. Low skilled workers are going to be held under that by most companies if they feel like they are not valuable enough to the company to pay either the $7,500 or so for the gold plated ObamaCare or the $2,000 fine. This is going to hurt so many folks. They will have to go onto Medicaid.

      • Just my opinion
        November 27, 2012

        You have it figure right. With the new 30 hour work week more companies will be going to less hours and more part time help to fill the hour being cut.

    • Anonymous
      November 16, 2012

      With Obamacare low wage workers will get a subsidy to pay for insurance. So Walmart will still not have to dip into its huge profits to pay for medical care for its employees.

      While now taxpayer funded Medicaid pays for care for employees, in 2014 it will be better because employee will have a plan that gives them some preventative care the taxpayer will still be paying. All the more reason to raise Corporate Income taxes on Walmart.

      Reply
    • Jon_quil
      November 28, 2012

      Do *not* blame Obamacare for this. Without it, most working poor would have NO insurance at all. In addition, Wal*Fart will get a subsidy to cover the additional costs. So, don’t go there. What you’re saying, while an understandable knee-jerk reaction, is simply untrue.

      Reply
  3. guest
    November 13, 2012

    your ceo is the problem. they put profits over people.

    Reply
  4. Barry G.
    November 16, 2012

    Just wondering, but how much is the monthly insurance? For example, for Dan Hindman and his son, how much is the coverage per month? How much is it for an individual? Again, I’m just wondering.

    Reply
  5. John
    November 17, 2012

    I don’t understand how Walmart employees can legally strike? They have the backing of the UFCW but they don’t have a collective bargaining agreement. Can’t they just be fired by Walmart and Walmart will just hire some others right off the street? Can someone please clear this up for em? I am a PT employee at Walmart in Southwestern Pennsylvania and am content with my hourly wage as it is “only” a second job for some additional income. I certainly don’t begrudge anyone doing what they are doing I just don’t understand the risk they are taking as once again I thought they could just be outright fired by WM.

    Reply
    • Anonymous
      November 17, 2012

      They can and will be fired. In America, there is a legal way to unionize. The unions have spent millions and millions of dollars of their members money trying to unionize with zero success. The union bosses are promoting this wildcat strike knowing the poor workers are going to be fired yet continue. The union bosses will then go back to their high paying jobs and the workers will be left unemployed. The workers are being used as pawns by the union bosses.

      Reply
  6. jollyinjax
    November 17, 2012

    To make it simpler for the uninformed. Walmart’s profit margin for the quarter ending July 31st, 2012 was 3.19%. For those who don’t get it, for every dollar they took in they got to keep roughly 3.2 cents of every dollar. When you put this simply, that’s not very much money. The reason their overall profit seems like so much is because they have so many stores. Not to mention so many loyal customers. Without Walmart I would not be able to survive. I refuse to demonize someone for being smarter than me and starting a business and becoming successful.

    Reply
    • Stan
      November 18, 2012

      @jollyinjax … where did you learn your math and economics? 3.19% margin means that for every $100 they made $3.19 BOTTOM LINE. That’s after paying the light bills, slave wages, huge executive bonuses etc etc etc. And being that the books of any corporation run on accrual rather than cash, means they also took out depreciation of existing structures, expenses for new installations/expansion, advertising, yada yada, so the actual profit is probably much higher. I.E. as an individual I buy something for $10 and sell it for $20, therefore I made $10. I take off my expenses of lets say $2, therefore I made $8, an 80% profit. However, as a corporation, I also pay expenses on my condo, my slaves, invest in a new venture, pay myself a fat bonus, put some in an offshore, and after all that I’m actually at a net loss of $20 and ask the govt to bail me out …..

      Reply
      • Anonymous
        November 19, 2012

        Wal-Mart must use the same accounting practices as required by all other companies. The average of the Fortune 500 companies is over 8%. Companies like Apple and Microsoft are over 25%. 3.19% is very, very low. Stop being confused by the union bosses wanting your dues money. Wal-Mart is a low profit margin company. That is one of the big reasons they have been so successful. Their pay and benefits are comparable to their other competition and better than the small, inefficient Mom and Pop stores they have replaced, They provide a cheaper alternative to hundreds of millions of folks who are watching their money and trying to extend it. their competition is also working these same hours. The whole reason for this, is that they have taken over a huge market share of the grocery business and drastically cut back on the union dues for the groceries that had to close and stop paying huge dues to the union bosses. You are being used.

      • John
        November 20, 2012

        If the union gets in Walmart that will change business in America for the good as they are the leader that all giants use as a model.
        I have seen the power of Walmart and their legal team and they do not even compare to small business.
        Walmart gets big tax breaks from cities that other businesses do not get and could not ever get. They get breaks on zoning and all kinds of legal things so you must figure that in as profit also. Please remember that those breaks come out of the local tax payers pocket . Please see the management that has come out on these issues so it is a good idea to paint the whole picture. Most will say they bring in tax dollars that small business can’t? As they take it from other surrounding areas and destroy local business and jobs. It lowers commercial property value also. Please do your homework on what Walmart does to your local area.

      • Anonymous
        November 20, 2012

        Wal-Mart sometimes gets initial tax breaks when cities are in competition for getting a store. These tax breaks are common for any new business and when they soon expire, Wal-Mart is frequently the largest tax payer in town. All small businesses do have a chance to compete with them and some thrive. Ever notice the area around their stores are built up pretty soon with small businesses. The inefficient small businesses that charge consumers much higher prices fail as a result of the consumers being given a choice. When I go to my local Wal-Mart, I see people carrying out a large number of packages. When I talk to local business people, I hear complaints about the horrible economy and lack of direction for the last 4 years. We have had the highest stretch of high unemployment since the 1930′s. Businesses are laying off and cutting back employees hours due to ObamaCare. The country appears to be going down the wrong road. Getting a bunch of Wal-Mart employees fired is going to be horrible for them and their families.

      • amy
        November 20, 2012

        Actually, no…that sounds nice, but the presence of Wal-Mart has resulted in the closure of two long-standing and beloved local hardware stores (both having been established over 140 years ago) in my town. The tax breaks are do not “soon expire.” It’s almost impossible to find things made in America in Wal-Mart. The road the city built to lead people to this eyesore may be named Wal-Mart Way, but it is the wrong way.

      • floridanativee
        November 20, 2012

        Over the last 35 years, the old fashioned hardware stores have been put out of business by Ace and True Value which are individually owned and operated by locals. This has happened all over the US, just as the small neighborhood pharmacy is now a rarity. It is also hard to find a buggy whip maker anymore. I know local tax breaks do in fact last a set number of years (5 is common). Your city may have offered too much. The fact that so many people do shop and build other businesses close to Wal-Mart seems to indicate that you are in the minority. People are willing to invest their hard owned capital and time out near Wal-Mart because this has a history of success. If everybody chose not to shop out there, then it would not be successful. Did the old hardware stores offer health insurance and a “living wage” to their employees?

      • amy
        November 20, 2012

        Yes, they both did.

        I don’t get your “in the minority” statement. Yes, other chains built near the Wal-Mart. It’s still an eyesore.

        But I get how the economies of scale work. Ace and True Value both coexisted in this town for years with the hardware stores I mentioned.

        Certainly the economic landscape has changed and there’s no point in living in the past – but when the bright future of cheap goods is purchased at the expense of people who simply can’t make it on their paupers’ salaries it is fundamentally an immoral situation. 80% of Wal-Mart staff on food stamps doesn’t make it. Offering health coverage they can’t afford to use don’t make it. Anybody who thinks that is OK ought to try it for awhile – with some health challenges in the family.

        If other conglomerates are keeping their working staff in these constraints, they ought to be stopped as well. I don’t have anything in particular against Wal-Mart, but its practices are egregious. You can ask the staff. I do. The buggy whip of poverty is very easy to find in the Wal-Mart equation, and it hurts.

      • floridanativee
        November 21, 2012

        You can not extrapolate your town to the US. The facts are that individually owned and operated Ace and True Value have destroyed the old hardware store (which I loved by the way). Please provide a link to your 80% food stamp statement. In the last 4 years food stamps have drastically increased. About 50% of Wal-Mart workers use the healthcare plans as I have read. You think it too expensive now, wait until 2014 when the ObamaCare mandates kick in. If we had the free market in the health care prices would be much cheaper. Look what has happened to Lasix eye surgery. It has no government payments and they prices have gone down 400 %. Most of the businesses around Wal-Mart are locally owned and operated franchises and employee local people who are happy to have a job.

      • Jon_quil
        November 28, 2012

        Bull crap. They’re using Obamacare to scare off employees from demanding better coverage. Why the hell don’t people watch something other than Fux Gnus (fox “news”) for their information? Wal*Fart, for example, makes more profits than any other retailer WORLDWIDE. They pay 61 cents/hour to workers in places like Bangladesh (where more than 100 workers just died in a horrific fire) and then cry bloody murdeer when they have to pay for health insurance. The guy who started Wal*Mart must be rolling over in his grave. He was a fair and decent man who would never oversee the kind of usery apparent at today’s Wal*Mart.

      • floridanativee
        November 28, 2012

        Do you not believe the congressional budget office or do you just suck up everything from your union newsletter? Wal-Mart did not own the factory or employ folks in that country. They along with many other companies bought their products because millions of American wanted them. Get used to your 29 hours a week.

  7. Dale
    November 19, 2012

    Everyone raised healthcare premiums , even the federal government except those in congress. Even tricare the military family plan for retirees went up.

    So 1/3 is taken for taxes and 1/3 is taken for healthcare. Shortly only the welfare checks will be paying you wages because the rest of us cant afford to go to Wal Mart anymore.

    My sympathies are with Wal mart employees but we are all in big trouble here, it’s not going to get any better eaither with this tax and spend mentality and free healthcare etc

    Reply
  8. Captain
    November 19, 2012

    couple of things to think about here. 1. WM is not unionized, so how do you think your striking? 2. when you do strike (walk out) does the union pres take a pay cut along with you?

    Reply
  9. Concerned
    November 24, 2012

    The Walton family has so much money, and they get greedier by the hour. Slavery was abolished eons ago. Pay your employees a decent wage and give them respect for their hard work.

    Reply
  10. txmouse
    November 24, 2012

    6 people control 41.5 of the overall wealth, control 31% of the economy
    with their business practices, and affecting an estimated 33.8 million
    households, I am less than willing to set on my hands any longer. Just
    these six people managed to suck 10 billion dollars in overall wealth
    from 2007-2010 American households, for an increase of 22%, while the
    rest of us, saw a 38% decrease in income earnings potential and wealth
    from an average of 126,000 in 2007, to 77,800 in 2010. So forgive the
    militant stand, but I wish I had JUST SAW a 38% decrease instead of
    about 65% and still looking for work as a professional with a deep
    technical knowledge and skills who gave 25 years to this machine that
    ate my pension savings and dang near my home, faster that you can say
    MADE IN CHINA and it still wants more.Those 6 people are the Walton Family

    Reply
  11. Bark
    November 24, 2012

    The only way to end the greed is to stop buying the Chinese products that Walmart sells. Better than 90% of the products are from COMMUNIST China! When you buy this crap YOU are eliminating American Manufacturing Jobs! http://forum.barkforum.com/f36-boycott-this

    Reply
  12. Just my opinion
    November 27, 2012

    Walmart is not the only ones to raise health care premiums. Many insurance companies a doing so with the explanation that they are gearing up for Obama care! Don’t blame Walmart, look to the government and the new regulations.

    Reply

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