CA State Bill Would Fine Firms Whose Workers Get Medi-Cal

Taxpayers who are even aware of the situation are fed up with taxpayers picking up the healthcare bill for profitable behemoths like Wal-Mart, so hopefully this is the beginning of a national trend:

For years, politicians and labor unions have pilloried Wal-Mart and other large employers for paying workers so little that many qualify for government health insurance at taxpayers' expense.

Now critics fear the public will get stuck with an even bigger tab as California and other states expand Medicaid as part of the federal healthcare law. That has California lawmakers taking aim at the world's largest retailer and other big firms.

Legislators, backed by unions, consumer groups and doctors, are calling for fines that could reach about $6,000 per full-time employee who ends up on Medi-Cal, the state Medicaid program for the poor and others. They say this would eliminate a loophole in the Affordable Care Act that encourages large retailers and restaurant chains to dump hourly workers onto the government dole because there's currently no penalty for doing so.

The outcome of this California battle could have national implications as other cash-strapped states search for ways to shore up safety-net programs that are bound to be stretched by a massive healthcare expansion.

"There are concerns that employers will be gaming this new system and taking less and less responsibility for their workers," said Sonya Schwartz, program director at the National Academy for State Health Policy. "This may make employers think twice."

The state proposal has already cleared key legislative committees. The next hurdle is getting approval from a two-thirds majority of lawmakers in Sacramento.

With the idea gaining momentum, retailers and business groups are pushing back. They say California's move would set a dangerous precedent and result in fewer jobs at a time when many people are still struggling to find work.

"It's one of the worst job-killer bills I've seen in my 20 years in Sacramento, and that says a lot," said Bill Dombrowski, chief executive of the California Retailers Assn. "The unions are fixated on Wal-Mart, but that's not the issue here. It's a monster project to implement the Affordable Care Act, and having this thrown on top is not helpful."

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