Filed Under:

Rising Health Costs Lead Companies To Drop Part-Time Benefits

Play associated audio

Wal-Mart's recent decision to cut benefits for new, part-time employees may be part of a trend, as companies grapple with higher health costs.

That's the view of John Rother, the new president of the nonpartisan National Coalition on Health Care, who chatted with All Things Considered host Robert Siegel about the country's growing pack of part-time workers and why companies are rolling back their benefits.

"We're seeing health costs becoming a larger and larger expense item for companies," Rother told Siegel. And that poses a particular problem for firms "engaged in international trade, where they're competing against companies that do not have to bear that expense."

"Because they're in countries where the government probably bears that expense," Siegel said.

"Exactly, which is mostly all other countries," Rother said.

With full health coverage costing about $15,000 a year for a family, it's not economic for many employers to cover their part-time employees, he said. And there's no government provision requiring employers to pay a penalty if they don't.

Rother blamed the fee-for-service model for the spike in health costs. "[It] encourages more and more care even when it's not necessary or even sometimes when it's not productive," he said.

Many employers are feeling overwhelmed, according to Rother. Costs went up about 9 percent last year, and in these times revenues often don't keep up. Employees didn't see a 9 percent pay increase either.

"Health costs are taking a bigger and bigger bite out of both take-home pay and the employers' cash flow," he said.

So what are the options for part-time workers without insurance?

"I don't mean to be flip, but your best option would be to marry somebody who has good health coverage," he said. "Because if you don't, there are very few options. Under the Health Reform Act, you will be able to get affordable coverage, but that's not until 2014."

Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/.

NPR

'Top Gear' Team Signs Deal With Amazon; New Car Show Set For 2016

The trio left the BBC under a cloud, after Jeremy Clarkson's contract was not renewed because of a physical and verbal attack on a show producer.
NPR

Do Fish Names Encourage Fishy Business?

Legally, a single fish species can go by many names from sea to plate, and different fish can go by the same name. An environmental group says that hampers efforts to combat illegal fishing and fraud.
WAMU 88.5

A Congressional Attempt To Speed The Development Of Lifesaving Treatments

Earlier this month, the House of Representatives passed the 21st Century Cures Act in a rare bi-partisan effort. The bill is meant to speed the development of lifesaving treatments, but critics warn it may also allow ineffective or even harmful drugs onto the market.

NPR

Obama Orders Development Of Supercomputer To Rival China's 'Milky Way'

It is hoped that the new supercomputer, expected to go online by 2025, would be the first to "exascale" machine — some 20 times faster than today's fastest machine.

Leave a Comment

Help keep the conversation civil. Please refer to our Terms of Use and Code of Conduct before posting your comments.