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Maryland legislators voted to become the first state to enact a law forcing large employers — namely Wal-Mart Stores Inc. — to pay a penalty if they fail to spend a certain amount of their payrolls in the state on health insurance for their workers.
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The Senate voted 30-17 to override Republican Gov. Robert Ehrlich's veto of the bill last year. The Maryland House followed suit last night with an 88-50 vote for the override.
The bill proposed requiring employers with more than 10,000 workers in Maryland to pay a penalty to the state's health-insurance program if they fall short of paying an amount equal to 8% of their payroll in the state for health insurance for those employees.
Only four private employers are large enough in Maryland to be covered by the bill: Wal-Mart, Northrop Grumman Corp., Giant Food LLC and Johns Hopkins University. Of those, only Wal-Mart might fall short of the 8% threshold and therefore pay a penalty. Wal-Mart representatives told Maryland lawmakers last year that the retailer's contributions toward health insurance for Maryland workers equaled between 7% and 8% of its payroll in the state. Wal-Mart employs 16,988 workers in Maryland.
Wal-Mart spokeswoman Sarah Clark declined to directly address the fate of Wal-Mart's operations in Maryland in light of the override. "Any business would stop after something like this and really look at what's going on," Ms. Clark said.
The debate could continue in the courts. The Maryland Chamber of Commerce has argued that the potential new law will conflict with federal employment law, namely the Employee Retirement Income Security Act. Supporters counter that it isn't pre-empted by Erisa.
Maryland isn't the first state to consider such a bill. Legislators in 12 others have proposed similar bills in the past year, according to the National Conference of State Legislatures. Only six remain under consideration. However, the likelihood of a veto override in Maryland emboldened labor unions in recent months to recruit legislators in dozens of states to introduce similar bills this year.
That impending push in statehouses across the country has spurred an evolution in Wal-Mart's approach to government relations. After decades of arguing its case in front of city councils and zoning boards, the retailer now must become a larger player in state politics.
Joe Kefauver, Wal-Mart's vice president of public affairs, points out that Maryland's is the only bill of several introduced last year likely to advance to becoming law.
"There are 7,000 legislators out there that we have to help educate." Mr. Kefauver said. "There's a story out there to tell on a lot of subjects about Wal-Mart, not just health care."
Last week, the AFL-CIO labor federation announced it intends this year to push legislation similar to Maryland's Fare Share Health Care bill in "more than 30 states." The AFL-CIO already has lined up lawmakers to sponsor the legislation in several states, it said. "An explicit part of the program is to put pressure on organizations nationally to do national reform," said Gerald Shea, government-affairs adviser to AFL-CIO President John Sweeney. "If people can't manage the political will to do something nationally to solve this problem, then would they like to deal with us in 50 different ways in 50 different states?"
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At lunchtime, in the break room of the Wal-Mart store in Laurel, the television delivered the news from the opening day of the General Assembly:
Maryland lawmakers would attempt this week to override the governor's veto of a bill aimed at forcing Wal-Mart to offer more affordable health care coverage to its 17,000 workers in the state.
"You better listen," Cynthia Murray told her co-workers gathered there. When her shift ended at 3 p.m., she turned her back on the store and headed through the rain to Annapolis.
There, the 49-year-old sales associate was embraced by lawmakers and union leaders. Still wearing her blue apron, with its "How May I Help You?" slogan, Murray offered a rare statement in this debate that has drawn national attention and spurred an advertising and lobbying frenzy.
Hers was the voice of someone who might actually be affected.
"I've worked at Wal-Mart for more than five years, and I still can't afford their health care. I know many of my co-workers can't afford it either."
Murray said the $200-a-month plan she was offered to cover her and her husband would cost about a quarter of her monthly pay. So she goes without coverage and prays that she and her family will stay well. She said she might face repercussions for speaking out, but that is beyond her control.
"God puts us in the right place for the right reasons. That is why I am here."
Wal-Mart officials countered that the company recently expanded its range of heath care plans -- including one that provides benefits for as little as $23 a month to a single worker.
"We provide insurance to over 1 million Americans," said Nate Hurst, a spokesman for the giant retailer. "Clearly this bill is about politics -- bad politics."
The debate over the Fair Share Health Care Fund Act, commonly known as the Wal-Mart bill, has dominated politics in the run-up to the General Assembly, with the retailer arguing that Democrats have unfairly singled out one company and union leaders arguing that workers deserve better treatment.
Murray's words were a rallying cry to the bill's supporters, who could vote as early as today on whether to overturn last year's veto by Republican Gov. Robert L. Ehrlich Jr.
The legislation, versions of which are being considered by more than 30 states, would require private employers with more than 10,000 workers to spend at least 8 percent of payroll on health benefits or make a contribution to the state's Medicaid program. Wal-Mart, with 53 stores and nearly 17,000 workers in Maryland, is the only large employer that does not meet that requirement.
Union activists and some lawmakers contend that the range of benefits offered by Wal-Mart is so expensive relative to workers' salaries, and eligibility is so restrictive, that many turn to Medicaid, the publicly funded health care program for the poor, for their coverage, and to a state health insurance program for children.
That leaves the state to pick up the costs, said House Speaker Michael E. Busch (D-Anne Arundel).
Busch could not provide figures for how many of Maryland's Wal-Mart workers are on Medicaid, and the AFL-CIO sued unsuccessfully to get that information, said Naomi Walker, the labor organization's director of state legislative programs.
But in 18 states that have released the information, Wal-Mart was among the top three employers that shifted workers into Medicaid, the children's insurance program and other state aid, Walker said.
A survey by Georgia officials found that more than 10,000 children of Wal-Mart employees were enrolled in the state's health insurance program for children at a cost of nearly $10 million annually.
Some of Maryland's Wal-Mart workers make so little that they qualify for such poverty programs.
The average wage for full-time sales associates in Maryland is $9.97 an hour, and full-time workers at Wal-Mart put in from 34 to 40 hours a week, Hurst said. At that rate, an employee working 40 hours a week earns $19,142 a year, an income below the $19,350 federal poverty level for a family of four.
Wal-Mart officials have said their company is living up to its responsibilities to provide adequate health care coverage to workers.
Under recently expanded benefits, Maryland workers now have a choice of several plans, including a "value plan" that costs $23 a month for a single worker, $37 a month for a parent and children, and $65 a month for two parents and children, said corporate spokesman Dan Fogleman.
That gives each family member three doctors' visits and three generic prescriptions before being subject to an annual deductible of $1,000. Full-time workers are eligible for enrollment after 180 days. Part-timers can enroll after two years.
"This plan would have been available" to Murray, Fogleman said. He said the company does not steer workers to Medicaid or other state programs.
For her part, Murray said Wal-Mart did not offer her any health insurance option other than the one she could not afford. She said she did not want to turn to Medicaid for help. "I probably do qualify, but that is not the way to go."
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source: http://www.washingtonpost.com/wp-dyn/content/article/2006/01/11/AR2006011102416_pf.html 13jan2006
In a boost to organized labor's campaign to force big companies to pick up more health-care costs, Maryland legislators voted Thursday to enact a "fair share" law aimed at the nation's biggest employer, Wal-Mart Stores.
The bill, the first of its kind in the nation, is a prelude to legislative battles in other states, including Illinois, where unions are preparing to introduce similar initiatives.
Maryland's law requires companies with more than 10,000 employees working in the state to spend at least 8 percent of their payroll on health-care benefits or to contribute the difference to a state fund toward health insurance for Maryland workers.
While several other companies are large enough to be covered, only Wal-Mart, with 17,000 Maryland employees, is believed to fall short of the minimum spending.
Wal-Mart spokeswoman Mia Masten said Thursday that the bill "could be the beginning of a slippery slope."
"We believe everyone should have access to affordable health insurance, although this legislation does nothing to accomplish that," Masten said.
She said Wal-Mart was unfairly singled out because of "partisan politics" and that Medicaid's problems go beyond the behavior of one company.
Maryland's action comes amid renewed interest in many states in curbing the ballooning costs of public health programs that must pick up the tab when working families can't afford health care.
"The eyes of the nation were on Annapolis today, and the override votes will generate important momentum in many other state legislatures that are considering similar health-care bills," said Andrew Grossman, executive director of Washington-based Wal-Mart Watch, a labor-backed coalition.
Maryland's Democratic-controlled Senate and House each voted Thursday to override last year's veto of the measure by Republican Gov. Robert Ehrlich.
Todd Maisch, vice president of governmental affairs for the Illinois Chamber of Commerce, which opposes such measures, called the vote a "real victory for organized labor" and "cause for great concern."
"For Illinois, business really needs to wake up and be ready for this type of effort," he said. "It will be well organized and if this [business] community isn't well prepared, we could be under some threat."
He called the legislation a form of payroll tax and a "proverbial nose under the tent" that, while aimed initially at the largest employers, could ratchet down to smaller businesses.
Such initiatives are not new. A similar law known as "pay to play" was voted down two years ago in California. In the early 1980s, there were successful legal challenges to payroll taxes.
In Illinois, where Local 881 of the United Food and Commercial Workers is expected to lead a campaign for a "fair share" bill, legislators in 2004 enacted a law requiring the state to develop a plan for a full range of health-care options by July 1, 2007. That bill does not set requirements for business but aims for universal coverage.
source: http://www.chicagotribune.com/business/chi-0601130249jan13,1,7412146.story?coll=chi-business-hed 13jan2006
The Maryland Legislature voted to override a veto of the so-called "Wal-Mart bill," becoming the first state to legally require large companies to pay a set amount of money for employee healthcare benefits.
The House of Delegates voted 88-52 last night to undo Governor Robert Ehrlich's veto of the legislation in May. The Senate earlier yesterday voted 30-17 for an override.
The law, called the Fair Share Health Care Fund Act, will require companies with more than 10,000 employees in the state to devote at least 8 percent of their payroll to healthcare.
Wal-Mart Stores Inc., the world's largest retailer, employs almost 17,000 people in Maryland and is the only large company in the state known not to already meet that threshold.
More than 30 other states, including Michigan and Wisconsin, are considering similar measures.
"This is a great moment for working families of Maryland and for businesses that do the right thing," said Vincent DeMarco, head of the Maryland Citizens' Health Initiative, an advocacy group in Baltimore. "This measure will sweep the country."
Wal-Mart said the Maryland bill sets a dangerous precedent and could prompt the Bentonville, Ark.-based retailer to rethink plans for a distribution center in Maryland that would create 800 jobs.
"It singles out one company at the interest of organized labor," company spokesman Nate Hurst said. "Businesses across the US will think twice about expanding in a state like Maryland."
source: http://www.boston.com/business/healthcare/articles/2006/01/13/md_overrides_veto_of_healthcare_bill_aimed_at_wal_mart?mode=PF 13jan2006
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