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Chattanooga Times Free Press, January 20, 2005
Wal-Mart and Chattanooga-based Krystal are among the top 10 businesses
in Tennessee with thousands of employees who choose to enroll in TennCare,
a new state survey shows.
Wal-Mart, the state’s largest private employer, tops the rankings
with 9,617 employees on TennCare — nearly 25 percent of the
Arkansas-based retail giant’s 37,000 employees in the Volunteer
State.
Krystal Co. is ninth on the list, with 3,183 employees enrolled in
the $8.7 billion state-run health insurance program for the poor,
uninsured and disabled.
"The fact of the matter is there is a trend here that large employers
have a large number of TennCare enrollees on the rolls, and we have
to find out what’s behind that," said Michael Drescher,
a spokesman for TennCare.
Companies on the state’s list denied they were encouraging their
employees to sign up for the state Medicaid program.
The figures come from a survey conducted during the past two months
of TennCare rolls and Department Labor and Work force Development
data. The information had been requested by the Chattanooga Times
Free Press during the fall. But state officials acknowledged late
Wednesday that the data may be imprecise because of high employee
turnover rates at private companies, as well as the number of employees
who work for company franchises who were not included in state Labor
Department totals. The data show the number of TennCare enrollees
who were employed by Tennessee companies at some point during the
year.
"We’re going to keep looking through the data," Mr.
Drescher said.
The findings, obtained Wednesday, come as legislation is introduced
in the General Assembly that would require the state to track all
companies that have at least 25 employees or their family members
enrolled in TennCare.
"I really think that this is data we need to have so it can be
demonstrated that many of the enrollees on TennCare do have jobs,"
said Rep. JoAnne Favors, D-Chattanooga, a co-sponsor of the legislation.
"But through no fault of their own, their companies do not provide
health care coverage."
The top 20 employers of TennCare recipients have a total of 68,303
employees, representing about 6 percent of the 1.3 million people
now on the state’s health care plan. Those employees likely
will be unaffected by a massive TennCare reform plan that is scheduled
to cut 323,000 people from the TennCare program, state officials said.
Gov. Bredesen has said he needs to control the double-digit cost increases
of the program, which he has said threaten to consume all new state
revenues unless they are contained.
Lydia Lenker, a spokeswoman for Gov. Bredesen, said it was premature
to comment on the legislation.
Wal-Mart spokesman Dan Fogleman said Wednesday the retail giant offers
health insurance and other benefits to all of its associates after
they have worked for either six months full time or two years part
time.
Mr. Fogleman called Wal-Mart’s benefits "competitive."
"If there are some of our associates who have decided for some
reason not to participate in our health plan, we don’t know
the reason," he said.
But Wal-Mart critics contend the world’s biggest employer is
relying upon government subsidies to help its employees.
Phil Mattera, a research director for Good Jobs First and frequent
critic of Wal-Mart, said the list of employers with Medicaid-dependent
workers and families shouldn’t include the largest and most
profitable companies in the country.
"There was a time when the biggest company in the land —
Ford Motor Co. in the early 20th century and General Motors after
World War II — set the pace for raising wages and benefits,"
he said. "But Wal-Mart seems to be leading us downhill and, in
effect, using the government to help pay for its expansion by not
giving its workers a sufficient health benefit plan, in many instances."
The Center for Labor Research and Education at the University of California
at Berkeley estimated last year that Wal-Mart workers in California
cost that state an estimated $32 million in health-related expenses
because of their employees’ reliance on public assistance programs.
"Wal-Mart, in its effort to drive costs down, shifts part of
their costs on to the public sector," said Ken Jacobs, deputy
chairman at the institute who authored the study on the "Hidden
Cost of Wal-Mart Jobs." "Wal-Mart offers health insurance,
but many of their options have high deductibles, and a lot of workers
with limited incomes decide it’s not worth the costs."
Roger Rendin, Krystal’s human resources director, said the restaurant
chain offers health care coverage to its corporate staff and restaurant
managers and limited coverage options for its hourly restaurant workers.
"The restaurant business is very competitive, but we certainly
offer a competitive wage package for our employees," Mr. Rendin
said.
At a given time, Krystal employs about 2,400 workers in Tennessee,
including 500 full-time and about 1,900 part-time workers. But many
of the hourly jobs at Krystal turn over several times each year, officials
said.
Temporary employment agencies represented seven of the top 10 companies
with employees on TennCare.
David Bartholomew, CEO of the Nashville-based Staffmark Inc. and chairman-elect
of the American Staffing Association, said temporary employment agencies
act as a bridge to help workers find jobs and employers to try out
new workers.
"Our company offers health insurance to all workers, and in many
instances our clients provide assistance in that coverage," he
said. Most short-term assignments, however, require that an employee
pick up the expense of the health coverage, Mr. Bartholomew said.
"Our workers are often more interested in building a resume or
getting work experience than they are in having health insurance,"
he said.
Andy Schneider, a Medicaid policy analyst in Washington, D.C., said
the state data reflect a national trend where employers are scaling
back insurance plans available to their employees.
"Studies show a lot of employers are walking away, and they’d
be walking away whether there was Medicaid or not," he said.
"If you assume that the alternative is those employees will get
nothing, it’s better for lowincome employees to have that (Medicaid)
coverage."
A September 2002 internal report from Georgia’s Department of
Community Health showed more 10,000 children of Wal-Mart employees
were enrolled in PeachCare, the state’s health care program
for children. Employees at Randstad Staffing had 305 children covered
in the state program, Georgia records show.
Jerry Lee, president of the 85,000-member Tennessee AFL-CIO Labor
Council, said the state’s data show that low wages and benefits
for temporary and retail laborers have hidden costs that ultimately
are picked up by taxpayers.
"It’s egregious," Mr. Lee said. "The AFL has
long been aware that these kinds of companies are putting their employees
on the public dole."
He said the low-wage, low-benefit jobs provided by temporary labor
companies, Wal-Mart and other retailers put pressure on employers
who pay "living wages" and provide affordable benefits for
employees.
Gordon Bonnyman, executive director of the Tennessee Justice Center,
which advocates for TennCare enrollees, said the state has failed
to reform the health insurance industry to allow large companies such
as Wal-Mart with low-wage earners to buy into TennCare or other insurance
health insurance.
"It would be good if we could get private employers to pitch
in and do their fair share, and take advantage of the economy of scale
and volume that Tenn-Care provides," Mr. Bonnyman said. "Nobody
understands volume discounts like Wal-Mart."
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