Wal-Mart eyes super savings ... by backing Obama's health care plan
First, Wal-Mart issued a statement supporting President Barack Obama's plan to provide broader health care coverage by requiring large employers to do just that. Not only is Wal-Mart publicly supporting this, but claims the Service Employees International Union and Center for American Progress as allies in the effort. Talk about strange bedfellows.
Wal-Mart's support also breaks with partisan lines and the popular belief that big business leans Republican. But corporations pledge allegiance to policy that serves their business, regardless of party. And most, when making donations, give to both parties just in case. There's no such thing as loyalty when it comes to business, except to shareholders. And that means a dedication to making money.
Health care has always been a hot button issue for Wal-Mart. It's a damned if you do, damned if you don't scenario, and whichever side the company comes down on invites mass amounts of criticism. Here, Wal-Mart's support gets it accused of trying put smaller competitors out of business since they couldn't afford to offer coverage. But the mandate doesn't require small businesses to provide health insurance, so let's move on to what really might be behind Wal-Mart's announcement.
Frankly, it's good marketing. Wal-Mart has officially aligned itself with the forces of good. Partnering with the union, shushes the anti-union crowd for a minute and maybe buys some good will with organized labor, for once. And on some levels, the Obama plan might just be Wal-Mart's best hope for actually providing coverage to the roughly 48% of its employees reportedly NOT covered (subscription required) by the company.
The last two paragraphs of Wal-Mart's statement on the matter are telling. The company supports the plan, yes. But clearly expects it to be accompanied by a fundamental change by insurers, complete with lower costs to Wal-Mart:
"We are entering a critical time where those of us who will be asked to pay for health care reform will have to make a choice on whether to support this legislation. The choice will require employers to consider the trade off of a coverage mandate and higher taxes for the promise of a reduction in health care cost increases. We also believe that a mandate must be accompanied by provisions that will reduce health costs and dramatically improve the value we get for our health care dollar.
"And the promise of savings in the bill must be more than just words. The bill should contain 'trigger' provisions that guarantee that promised savings take place both for the federal government and for employers who provide insurance. Walmart believes that if we support a mandate and are being asked to pay higher taxes, we should be assured in return, that savings will be real."
I've often wondered what would happen if Wal-Mart put its muscle behind health care reform. Could it get the insurance companies to cut costs and streamline operations similar to how it changed the retail industry? We could be about to find out.