According to the Wall Street Journal, the McDonald’s Corp. has warned federal regulators that it may end its health insurance plan for nearly 30,000 hourly restaurant workers, unless the feds waive a new requirement of the health care reform law.
The specific issue of concern is the percentage of premiums that must be spent on benefits. A memo to federal officials, stated “it would be economically prohibitive for our carrier to continue offering” the mini-med plan if they did not receive an exemption from the requirement to spend 80 to 85 percent premiums on benefits.
In a written statement to the media, McDonald’s refuted the Wall Street Journal‘s assertion that it will drop healh care coverage for employees. “Media reports stating that we plan to drop health care coverage for our employees are completely false,” said Steve Russell, a senior vice president and head of human resources for McDonald’s, in a written response to the article. “These reports are purely speculative and misleading.”
Democrats who designed the health care law wanted the requirement to prevent insurers from spending too much on executive salaries and other costs that do not directly assist patients.
Changes that are supposed to assist low-wage and individuals living in poverty will not start until 2014 under the Obama plan. People with an income up to 133 percent of the federal poverty level will be eligible for Medicaid, and those with an income between 133 and 400 percent of the poverty level will be eligible for subsidized health insurance.
Although many restaurants don’t offer health insurance benefits, McDonald’s plan allows workers at 10,500 U.S. locations to pay $14 a week to get coverage up to $10,000 a year. If McDonald’s does not receive the waiver, it will be very troubling for the millions of African Americans who work for this corporate giant. –torrance stephens, ph.d.
