Healthcare Savings = Myth

The most high profile case of a company offering the President’s “brilliant” idea of the Health Care Savings Accounts and Low Cost, High Deductible plans is (no surprise here) Wal-Mart.  Wal-Mart of course used these plans to “promote” the ability of their workers to get some sort of health insurance, and try to take some pressure off of themselves.  But, when you actually look at them, you see just how deficient these programs are.

Industry monitors put Wal-Mart’s wages at $8.23/hr., however Wal-Mart puts this at $9.68/hr (UFCW) so in the spirit of fairness, I will go with the higher wage.  A Full-time employee at Wal-Mart works 34 hours per week (Wal-Mart 2006 Associate Guide), so that works out to $329.12/week or $17114.24 annually.  Now let us grab a minimum of 22% for the combination of Federal/State and other taxes, leaving $13,349.10.  Premiums that must be paid by an individual is $22/month  or $265/yr (Wal-Mart Facts), leaving our fair worker $13,084.10 (about $251 a week).

With that of course you have to take care of silly things like rent.  The Average rent across the country was $940/month at the end of 2005 (http://realestate.msn.com/Rentals/Article.aspx?cp-documentid=262101), but let assume that our worker understands he can’t afford average working at Wal-Mart and finds some dump for $500/month, that still leaves him(or her of course), with just over $7K for everything else… food, clothing, gas (or public transit costs), and so on.

So now our worker gets sick.  (Which of course we have not considered lost wages)  out of that remaining $7,000 the first thousand (per person, if this is a family of 3, then it is the first $3,000) must go towards the deductible before the insurance actually kicks in.  Tell me, if this was you, could you find a way to save  thousand(s) of  dollars for your deductible?

Wal-Mart doesn’t care about their employees.  I am breaking no new ground her, sites like Wake Up Wal-Mart,  and books like “The High Cost of Low Prices” have been documenting these abuses for years.  No rather, what I am trying to use this (unfortunate) example of is the plans that are still trying to be sold to us under the guise of “health-care reform.”  In this example, the worker, because he (she) is paying “virtually nothing” (according to the rich people that are promoting this junk), they are supposed to be able to put money into a “health-care savings account”  (”certain fees may apply of course”) to help “offset” the cost.  But just where is the saving supposed to come from.  Are you supposed to “hope” you don’t get sick until you happen to have enough in the account to cover it?  Put off having a baby because you need to save up who knows how much before you have enough banked health-care?

This is not the answer to a health-care crisis.  It is a plan to line the pockets of insurance companies, and to provide cover for corporations like Wal-Mart to show that they offer plans for their employees with minimal to no cost.  It is a game, and one most people can’t afford to play.

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