The Center for a Changing Workforce 1 Everyday Low Benefits: Health Insurance in the Age of Wal-Mart The Center for a Changing Workforce Seattle, WA

The Center for a Changing Workforce 2 What is the Changing Workforce? Contingent work is temporary day labor, on-call, contract, and direct hire temps. Independent contractors & part- time. Many permatemps 20% longer than 1 year.

The Center for a Changing Workforce 3 Contingent and Nonstandard Work Arrangements

The Center for a Changing Workforce 4 Nonstandard employment is growing 25% of workforceover 30 million workers. Temporary employment grew 90% Fastest-growingstaffing firms projected to add 1.8 million new jobs

The Center for a Changing Workforce 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.

The Center for a Changing Workforce 6 Future Health Insurance for Low Wage Workers? Employers and insurers have a new vision…

The Center for a Changing Workforce 7 Benefits in a Card Health Benefits Benefit CategoryLimit Medical Expense Insurance Coverage Year Maximum Benefit (per insured family member)$4,000 (Within this Maximum, the following limits apply per insured: Inpatient Services (hospital charges other than room and board)$1,000 Outpatient Services $2,000 Daily Allowance for Hospital Room and Board Intensive Care $400 All other accommodations $200 Insured percentage for all covered expenses except doctor office visits 80% Deductible per calendar year (doesnt apply to doctor office visits) Per insured person $200 Per family $500 Doctor Office Visits (not subject to deductible) Office Co-pay $15.00 Insured percent (100% of reasonable and customary charges) 100% Prescription Drug Benefit Discount on all drugs up to 35% Drug costs are covered under outpatient benefit maximum $2,000 Source: Limited Benefit Insurance – All Youll Ever Need?

The Center for a Changing Workforce 8 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. Medical Discount Cards Dont leave home without them?

The Center for a Changing Workforce 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

The Center for a Changing Workforce 10 How Employees Get Excluded from Health Insurance at Work Employers segment workforce to exclude less-favored employees.

The Center for a Changing Workforce 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.

The Center for a Changing Workforce 12 COMFORCE has helped some clients cut labor costs by as much as 50%. Your Costs without Comforce: Your Savings with Comforce: How Payrolling is Sold to Employers:

The Center for a Changing Workforce 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.

The Center for a Changing Workforce 14 Independent Contractors or Employees? Home Care Workers Labeling employees as franchisees or businesses Construction work – using labor brokers.

The Center for a Changing Workforce 15 Part-time work: Wal-Marts Example 300,000+ part-time employees Work less than 35 hours a week Must wait 24 months No family coverage Starbridge mini-medical

The Center for a Changing Workforce 16 Underinsurance: Wal-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.

The Center for a Changing Workforce 17 Wal-Marts Medicaid Subsidies Ranked 1 st in 16 of 18 states for Medicaid and S-CHIP subsidies. Every new store means $100,000+ annually in Medicaid costs.

The Center for a Changing Workforce 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?

The Center for a Changing Workforce 19 Federal Policy Options Increase access to employer- provided insurance. Clarify ERISA to address misclassification problem.

The Center for a Changing Workforce 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.