‘Fair Share’ Bills Aimed at Wal-Mart Move through State Legislatures

A study released in June by the Council for Affordable Health Insurance (CAHI) sheds light on the effect of so-called “Wal-Mart bills,” which several states are considering to reduce the number of uninsured residents.

In January, Maryland became the first state to require businesses with more than 10,000 employees to pay into a state fund for employee health care. It is officially called “fair share” health care legislation but has been nicknamed after the only company in Maryland that was affected by the law. At press time, legislators in California, New Jersey, New York, and North Carolina were considering similar proposals.

Costly Mandates, Regulations

According to “What’s Fair About Fair Share? Wal-Mart Bills Are Growing in Popularity and Intrusiveness,” by Adam Brackemyre, CAHI’s assistant director of government affairs, the primary cause of high health insurance costs is state mandates and regulations, which in turn force more people to choose to do without insurance. Instead of fixing that problem, the “Wal-Mart bills” simply compel large companies to spend more on health benefits, while doing nothing to make health insurance more affordable.

J.P. Weiske, CAHI’s director of state affairs, said it’s a dangerous approach to reform.

“Fortunately, we haven’t seen states adopt this wholesale,” Weiske said. “By and large, legislators understand that this legislation is being used as a political tool to punish a company that is unpopular with certain segments of the population. Legislators would serve their constituents much better by looking at what they [themselves] have done to damage health insurance consumers in their states with invasive regulations, mandated benefits, community rating, and guaranteed issue.”

CAHI is an Alexandria, Virginia-based advocacy group representing small insurance carriers.

Specific Targets

In New Jersey, six “Fair Share” bills were submitted to the state General Assembly this spring. One of them, S.B. 477, the Responsible Employer Act, sponsored by state Sen. Stephen Sweeney (D-Glouchester County), specifically refers to large retailers such as Wal-Mart. At press time, the bill was pending in the state Senate Budget and Appropriations Committee.

New Jersey Citizen Action (NJCA), a Hackensack, New Jersey-based self-described watchdog organization that says it works against those with “money and power,” supports Sweeney’s bill.

“NJCA supports Fair Share as a means of helping people get coverage and assisting the state in its efforts to offer health insurance to those who do not have it,” said Michael Olender, a health care organizer with the group.

“Ultimately though, NJCA believes that the most efficient long-term answer to our health care crisis is the single-payer option,” Olender acknowledged. “Until the legislature comes to its senses and adopts the more sensible and efficient single-payer system here in New Jersey, the business community will continue to be asked to assist the state in resolving the state’s health care crisis of unaffordable health care and hyper-inflation rates for insurance and prescription drugs.”

Several Bills Introduced

Across the country, 15 Wal-Mart bills were introduced in state legislatures earlier this year. For example:

Colorado Gov. Bill Owens (R) vetoed on June 2 a measure that would have required anyone receiving public health care benefits to report his or her employer to the Department of Labor and Employment, which would compile annual reports on which employers with 50 or more workers had employees who received public health care benefits. The bill also would have required employers with more than 500 workers to report to the Department of Labor and Employment how much they spend on health care for each employee.

“Democrats brought forward this bill to show that some ‘big bad businesses’ are not giving enough for health,” said Beth Skinner, Colorado state director for FreedomWorks, a Washington, DC-based policy advocacy group with 35 state chapters. “Businesses shouldn’t be forced to provide health care. Health care has become expensive because of regulation, and this bill just brings more regulation.”

In California, state Sen. Carole Migden’s (D-San Francisco) S.B. 1414 passed the state Senate 22-14 with three abstentions, on June 1. It requires businesses that employ more than 10,000 people statewide to prove they are paying 6 percent or more of their payroll budgets on employees’ health care or pay a penalty fee to the state. At press time, the state House Appropriations Committee was scheduled to consider the bill later this year.

The New York General Assembly considered six “fair share” bills this spring. One would require any employer with more than 100 employees to pay into a state fund $3 for each hour worked by someone who was not provided health insurance, and $600 per week for each salaried employee not given health insurance. With 87 sponsors, the bill was pending in the health committee at press time.