The biggest retailer in the U.S. – Wal-Mart Stores Inc. will cut health insurance to about 30 000 of its part-time employees amid increasing medical-care expenses under Obamacare. According to an official statement published on its website, the company has made the decision to stop providing employees, who work less than 30 hours a week, with health coverage.
The Senior Vice President of global benefits of Wal-Mart – Sally Welborn, shared in a blog post on the companys website, which was cited by the Financial Times: “Like every company, Walmart continues to face rising healthcare costs. This year, the expenses were significant and led us to make some tough decisions as we begin our annual [healthcare] enrolment.” Ms. Welborn also wrote: “We don’t make these decisions lightly, and the fact remains that our plans exceed those of our peers in the retail industry.”
Wal-Marts decision is considered significant enough to attract public attention to the influence that the health-care reform is having on business, and respectively, on employees. The Obamacare reform will require from the employees, who lost their Wal-Mart health-care insurance, to purchase private insurance on exchanges, which are supported by the government.
There are currently a lot of companies, who are transferring insurance costs to their employees. According to Wal-Mart statement, the medical-care costs coverage changes, which Wal-Mart undertook, are in line with the steps taken by other retailers such as Home Depot Inc., Walgreen Co. and Target Corp.
About $446 billion on medical insurance premiums were spent by employers in the US private sector in 2012. The companies were expected to pay a total of $483 billion this year.
Wal-Mart Stores Inc. closed 0.06% lower on Tuesday in New York at $77.30 per share, marking a one-year change of +7.56%. The company is valued at $249.10 billion. According to CNN Money, the 21 analysts offering 12-month price forecasts for Wal-Mart Stores Inc. have a median target of $80.00, with a high estimate of $90.00 and a low estimate of $69.00. The median estimate represents a +3.49% increase from the last price of $77.30.
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