In Focus
Most large employers in Maryland offer quality, affordable health care benefits to their employees. But an increasing number of the biggest employers -- led by Wal-Mart -- offer either no benefits, benefits with too many rules attached, or benefits so costly that few of their underpaid employees can afford to purchase them. These bad apple corporations are a major reason why the number of uninsured in Maryland is increasing -- and why the state must pay ever more to treat the uninsured through expanded Medicaid outlays and other programs.
Interventions by the state to help the uninsured are very costly to the rest of consumers because hospitals often inflate their charges to subsidize the uninsured. And it's costly to the state of Maryland because when uninsured workers and their families go to the emergency room, the costs are passed along to taxpayers, insured workers, and businesses that do offer real health benefits to employees. Each year, the state and federal government along with responsible Maryland businesses contribute $400 million to Maryland hospitals – subsidizing the costs of hospital care for the uninsured and giving non-insuring or under-insuring businesses a free ride.
Free riders such as Wal-Mart then gain an unethical advantage in the market place against competitors who do cover employee health care costs.
Why should Maryland taxpayers subsidize the world's richest corporation, Wal-Mart?
Why should Maryland taxpayers actually help companies such as Wal-Mart gain an unfair competitive advantage in the marketplace?
Marylanders think this is wrong -- on both counts. That's why UFCW, the Service Employees International Union (SEIU), Maryland Citizen’s Health Initiative, Progressive Maryland and other groups are proposing legislation that would compel companies that currently do not provide quality, affordable health care to begin doing so. SB790, the “Fair-Share Health Care Plan”, sponsored by Sen. Gloria Lawlah and Del. Anne Healey, would require the biggest employers in our state, notably Wal-Mart, to finally begin paying their fair share. It will level the playing field so that businesses can compete fairly. And it will put more funds into health care expansion so that more Marylanders get access to high quality, affordable care.
SB790 provides that all employers with 10,000 or more employees who spend less than 8% of payroll on health care benefits for employees would pay the State the difference between what they spend on benefits and the 8% payroll amount. Non-profit employers who spend less than 6% of payroll would pay the State the difference between what they spend on benefits and the 6% payroll amount. Companies not doing their “fair share” could choose whether to increase their spending on health care benefits or pay into a special fund to help expand Medicaid eligibility.
Most large employers pay 9% or more of wages on health insurance, according to various industry studies, including companies like Giant Food and Safeway. However, a few of the state’s largest employers, like Wal-Mart, pay only 3-8% of payroll on health benefits. Because the health benefit package they offer is so unaffordable, few employees elect to purchase it. Facing up to an 8% of payroll health system user fee, non-insuring or under-insuring companies would have a real economic incentive to begin offering affordable health benefits to their employees. A firm electing to pay the assessment, for example, would pay the equivalent of health benefit costs but not enjoy the benefits of reductions in turnover, training and recruitment costs as well as the federal tax deductions for their employees’ insurance.
There is no reason to continue with an un-level playing field that drives up the cost of health insurance, limits consumer choice and creates a financial incentive for employers to drop health coverage for their workers. And there is no reason for taxpayers to continue to pay the health care bill for Wal-Mart's exploited employees. Click here now to tell your lawmaker to support this commonsense bill. It only takes 30 seconds, so click here now to make sure that more of our fellow Marylanders get decent medical attention when they need it.
