Maryland Sets a Health Cost for Wal-Mart
By MICHAEL BARBARO
ANNAPOLIS, Md., Jan. 12 - The Maryland legislature passed a law Thursday that would require Wal-Mart Stores to increase spending on employee health insurance, a measure that is expected to be a model for other states.
The legislature's move, which overrode a veto by Gov. Robert L. Ehrlich, was a response to growing criticism that Wal-Mart, the nation's largest private employer, has skimped on benefits and shifted health costs to state governments.
The vote came after a furious lobbying battle by Wal-Mart and by labor and liberal groups, and is likely to encourage lawmakers in dozens of other states who are considering similar legislation.
Many state legislatures have looked to Maryland as a test case, as they face fast-rising Medicaid costs, and Wal-Mart's critics say that too many of its employees have been forced to turn to Medicaid.
Under the Maryland law, employers with 10,000 or more workers in the state must spend at least 8 percent of their payrolls on health insurance, or else pay the difference into a state Medicaid fund.
A Wal-Mart spokeswoman said the company was "weighing its options," including a lawsuit to challenge the law because it is close to that 8 percent threshold already.
It is unclear how much the new law will cost Wal-Mart in Maryland - or around the country, if similar laws are adopted, because Wal-Mart has not publicly divulged what it spends on health care.
But it was concerned enough about the bill to hire four firms to lobby the legislature intensely over the last two months, and contributed at least $4,000 to the re-election campaign of Governor Ehrlich.
A spokeswoman for Wal-Mart, Mia Masten, said that "everyone should have access to affordable health insurance, but this legislation does nothing to accomplish this goal."
"This is about partisan politics," she said, "and this is poor public policy driven by special-interest groups."
There are four employers in Maryland with more than 10,000 workers - among them, Johns Hopkins University, the grocery chain Giant Food and the military contractor Northrop Grumman, but only Wal-Mart falls below the 8 percent threshold on health care spending.
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