Wal-Mart Endorses Employer Based Health Care
In somewhat of a surprise move, Wal-Mart on Tuesday announced an endorsementof employer-based funding for health insurance. Wal-Mart is the largest private employer in the country and has been criticized in the past by labor groups for its modest employee health insurance plans.
In an interview with the Wall Street Journal, the senior manager for health policy for the U.S.Chamber of Commerce reiterated the fact that the vast majority of the Chamber's members continued to oppose a forced mandate on employer funded health care.
So what's Wal-Mart's motivation.
Their stated purposes are to decrease the number of uninsured and to bring down the cost of health care. In the middle of a recession, however, forcing small employers to purchase health insurance is a guaranteed way of driving more employers out of business. Could this decrease competition and benefit Wal-Mart? Probably.
Often the best defense is a good offense. Could it be that Wal-Mart wants to appear as an ally in the Administration's push for health care reform, enjoy potentially good public relations, and at the same time ease its strained labor relations? Very possibly.
The driver for increasing health care costs in this country is that some third party (either employers or the government) pays for almost 90% of our health care. If someone else pays for our health care (or food, or clothes, or shelter), demand will far out pace supply and costs will rise. By mandating that employers must pay for employee health care, this model of third-party payer will be more firmly entrenched and will lead to further increases in costs.