Wal-Mart to Cut Some U.S. Health Coverage

Will charge smokers extra for coverage

Retail giant Wal-Mart said on Oct. 21 that it will no longer provide health insurance to new part-time U.S. employees working less than 24 hours a week and charge more for workers who smoke.

Wal-Mart, which has 1.4 million employees in the United States, will also increase coverage costs for all employees, as health costs rise. The changes, which will affect Wal-Mart and Sam's Club associates, are due to take effect in January.

"The current health care system in the United States is unsustainable for everyone and, like other businesses, we've had to make choices we wish we didn't have to make," said Wal-Mart spokesman Greg Rossiter.

"The United States needs to find a way to reduce the cost of health care, particularly in this economy," noting that employees who smoke would have to pay a supplement on their policy.

But he noted that Wal-Mart will continue to pay the majority of health care costs for full-time and part-time employees. Over one million people are currently insured under the plan.

But critics suggested the move could have wider and negative consequences.

"This lowering of working standards will have repercussions throughout the retail industry -- particularly for part-time workers," said Joseph Hansen, president of the United Food and Commercial Workers International Union.

"It's critically important that retail employers compensate their workers with pay and benefits that allow them to live in the middle class."

Copyright Agence France-Presse, 2011

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