Trader Joe's To Drop Health Coverage For Part-Time Workers Under Obamacare: Memo

[Jesus Malverde]

After extending health care coverage to many of its part-time employees for years, Trader Joe's has told workers who log fewer than 30 hours a week that they will need to find insurance on the Obamacare exchanges next year, according to a confidential memo from the grocer's chief executive.

In the memo to staff dated Aug. 30, Trader Joe's CEO Dan Bane said the company will cut part-timers a check for $500 in January and help guide them toward finding a new plan under the Affordable Care Act. The company will continue to offer health coverage to workers who carry 30 hours or more on average.

The law mandates that companies with 50 employees or more offer coverage to such full-time employees, though the Obama administration has chosen to delay that rule for a year.

Trader Joe's has won kudos for offering its health care, dental and vision plans to part-time workers at a reasonable price -- a rarity in an industry known for low pay and scant benefits. But with low-wage workers eligible for tax subsidies to buy health insurance next year, the company has apparently calculated that offering medical coverage to part-timers who work 18 hours or more is no longer worth the cost.

http://www.huffingtonpost.com/2013/09/11/trader-joes-obamacare_n_3902341.html

Trader Joes is owned by the same people who own aldi's the Walmart of Europe.

[AZ Mike]

1. Why the consternation over this?

This is good news. It's exactly what we should expect from the Obamacare mechanisms.

This is proof that the exchanges will work and provide healthcare independence for customers. That's the point.

Also, whereas it may be cost-benefit move on TJ's part, it is also a good thing that TJ's will be able to effectively reduce its non-operating costs. That puts the lie to the "Obamacare will kill jobs" canard.

[AZ Mike]

2. Oh....

....and this news will make me MORE LIKELY to shop at TJs. I love that store, it pays higher than industry-average wages, its associates are happy, it offers great products at great prices, and now it is contributing to the success of universal access to healthcare under the Obamacare exchanges.

[mike_c]

4. I don't see this as a good thing at all....

Many, it not most of those employees will likely end up grossly under-insured, stuck with plans that only provide coverage on alternate Tuesdays and have ruinous annual deductibles. TJ is going to give them a one time check that works out to $42 per month for one year-- if insurance can even be obtained for that cost, it will likely be crappy, but I'm willing to bet most employees will end up uninsured or under-insured. How is that a good thing?

[SoCalDem]

6. There are part-timers who probably will end up paying NOTHING

for their share of the costs under the exchange..

If they work 20-28 hrs @ $10 an hour, that would qualify MOST of them for medicaid or a policy that would end up cheaper and better than what they paid at work..

It's just the way the math works out..
.................................................................................
Thu Sep 5, 2013, 02:27 PM

Star Member SoCalDem (100,503 posts)

New ad suggestion.... Do the MATH, before you run your MOUTH

http://www.democraticunderground.com/?com=edit&forum=1002&thread=3605020


http://laborcenter.berkeley.edu/healthpolicy/calculator/

This would be especially enlightening for the tea party types who may be on the $10 hr "Gravy train"..

They only need to tune OUT the millionaire spokespeople of their party, and spend a little time running their own numbers..

an example, I ran:

A single 27 yr old making $10 hr for 30hr workweek

means no more piggybacking on parents' policy

and under the "minimum" hours needed for company coverage..

Here's what THEY would pay:

they are at 131% of poverty level and would pay ZERO...and would be covered by medicaid

..................................................

married to a another of same circumstance and add a kid, and you get :

$787.00 a month for SILVER PLAN

MINUS

$683 SUBSIDY..

ending up with $104 per month for TWO parents AND the baby

$34.67 per person...

and that's SILVER...not bronze

[AZ Mike]

10. EXACTLY!!!

Again, the TJ issue is a POSITIVE development.

(cue the "Up is down" whiners)

[HereSince1628]

16. Medicaid isn't the same across states.

WisCONsin government is pushing hard to recover all medicaid money paid out across a person's life from said person's estate.

That really isn't insurance coverage that's reverse mortgaging health costs.

[SoCalDem]

25. Stuff like this needs to be tied to ELECTIONS

Nefarious schemes put in place CAN be removed with democratic majorities..

Our party needs to hammer away at stuff like that and return themselves to office.

and very poor folks who need medicaid, often leave no "estates".

[HereSince1628]

54. Elections, well sure, kick the can, but people should not think medicaid is uniform over the US

It really isn't.

I completely understand how most people will have only scant familiarity with the medicaid plan in their own state, and have no chance to understand the program as it exists in the rest of the country.

The attitude that "it works for me/us here in my state" so everything is ok, is basically myopic political solipsism that will facilitate state to state disparities.

It's great to have faith that everything is going to work out. But, I rather suspect the result of medicaid as the ultimate backstop for healthcare coverage will share many of the disparities that have developed for education and voting rights.

As we see in Wisconsin, resentment of social responsibility toward the poor and needy is a something like the jet of water used in a hydraulic mine; in the hands of the socially irresponsible it quickly erodes all evidence of the slowly accumulated structures of a caring community and leaves behind a tortured landscape.

Going ahead we'll see how this plays out for the ACA. In Wisconsin, the political landscape already is metaphorically looking more and more like this:

[Jesus Malverde]

56. Well written and interesting...thanks..nt

[pnwmom]

9. That isn't true at all. Under Obamacare they will have a choice of plans

covering the Essential Benefits -- these aren't bare bones plans, like many of the plans they will replace. AND they will be eligible for substantial subsidies/credits, assuming they don't have a high family income because of a working spouse.

[Bandit]

11. If they are already offering healthcare benefits why would they drop them?

The ONLY reason I can fathom is they want to try and hurt Obama and America in general...

[AZ Mike]

12. Lol.

It's more than likely simply a cost and administrative decision.

If companies wanted to "hurt Obama and America" (Lol), they would keep their employees on shittier, company-provided insurance. This would render the exchanges useless and would degrade the type of access Americans have.

TJs (and Costco, and QuickTrip) are not the types of activist companies you are presuming them to be.

Jeez. Give it a rest.

[Bandit]

19. Your reply makes zero sense

As does this company's decision to drop coverage for employees they have been covering for years.

[SoCalDem]

29. Example:

"Joe" works 25 hours a week and pays $40 something for shitty coverage with co-pays & a deductible amount.. His paycheck is probably not all that much..

with the exchanges he can get a SILVER plan for probable UNDER $40 (cost to HIM), and the employer might have that extra money they were paying for him , so they might either increase his hours or maybe hire some extra people or.....

We are on our way to universal coverage as more employers opt out.. It may not be "pretty" as it rolls out, but eventually employers will just stop being "in charge" of their employees medical /personal choice, and go back to just paying them decent wages for work done...

Legislation will probably have to be passed somewhere along the lone to MAKE these employers "pass on their savings"... the money they "claim: to have been paying on their behalf ...instead of giving them raises.

When employees no longer have "boss-participation" they have every right to claim that unspent money as raises deferred for far too long..

That's how the econpmy starts to grow..

Boss says,, "Sorry, can't give you a raise because company share of your insurance went up $200 a month, and by the way YOUR share now is going to cost YOU an extra $50 a month".. If boss no longer has to pay that $200 + whatever he says it used to be, and you no longer have to pay the extra $50 plus what you already paid, that extra money should be in your paycheck...as INCOME..

Suddenly YOU have more money to use in the economy...AND the exchanges provide you with more choices, at better rates..

and your boss is no longer holding you hostage to a job you may want to leave some day.

[AZ Mike]

30. Ding! Ding! Ding!

We are on our way to universal coverage as more employers opt out.. It may not be "pretty" as it rolls out, but eventually employers will just stop being "in charge" of their employees medical /personal choice, and go back to just paying them decent wages for work done...

We have a winner!

[AZ Mike]

31. Just because you don't understand it....

....doesn't mean it makes no sense.

[Travis_0004]

41. Less options are seldom a better choice

So much for the whole "you can keep your insurance" quote that was going around when this passed.

Either way, Trader Joes dropping part time employees is not a good thing. Between the opening on the exchanges and next year, people have 2 options. The exchange, or company insurance. Some people will find the exchange is the best for them, others will think that company insurance is the best for them. Next year there will only be one option, and less options is not an improvement.

[AZ Mike]

42. You don't have an option if your company provides insurance.

You are only eligible for the exchange if your employer does not provide insurance. Either way, one option.

[SoCalDem]

57. That's why we "lost" our clinic of 30 years & ended up with Kaiser

Boss quit offering the plan that included "our place".. It was PPO or Kaiser..

[Travis_0004]

59. Sure you can

Anybody can buy insurance on the exchanges, but if your insurance is deemed affordable from where you work (less than 9.5% gross income), then you can not get a subsidy.

Also, you lose some tax benefits buying off the exchange vs from your employer, and you only have W-2 wages.

[AZ Mike]

62. Thanks.

The exchanges are even better and more accessible than I had thought.

[SoCalDem]

55. It's pie

Boss offers apple pie..one slice

Hometown Pie Shoppe (ACA exchange) offers MANY pies..many flavors..many prices..

Cherry Pie Haven ( one individual insuror) offers.. well.... cherry pie..at the price CPH charges..take it or leave it..

[valerief]

3. Do you ever wonder if the plan is to implement Obamacare, have businesses drop

med insurance as a bene, and then Congress will kill Obamacare? Then med insurance premiums can rise, businesses will still not provide med insurance as a bene, and more people will die before they can collect Medicare and Social Security. Medicare and Social Security never go, because the paycheck deductions provide pin money for the elite, but, of course, over time those benefits will be greatly eroded by Congress.

[EC]

5. So if they use the $500 to buy

insurance, what happens when they switch jobs? Would they have to give back the remaining amounts that wasn't used?

[Pretzel_Warrior]

7. I forgot. Someone do the tally. Does this put them in the "Evil" column or "Not Evil" column.

Please help direct where I am supposed to shop.

[Jesus Malverde]

13. Here are some items for your list

They are not owned in the USA. - Owned since 1979 by a German family trust established by Aldi Nord's owner Theo Albrecht.

Theo Albrecht - Nazi Soldier -
http://www.theoriginof.com/karl-albrecht.html

Little is known of the private lives of the Albrecht family, but Theo’s wealth was estimated by Forbes last year at $16.7 billion, making him the 31st richest person in the world and Germany’s second richest behind Karl at $23.5 billion; the brothers fortunes combined were exceed only by those of Warren Buffett, Bill Gates and the Mexican Carlos Slim.

The Albrechts’ obsession with privacy — living behind fortress-like security on estates overlooking the Ruhr valley, rarely snapped by paparazzi, never making public statements

http://www.telegraph.co.uk/news/obituaries/finance-obituaries/7919521/Theo-Albrecht.html

They sell mostly frozen and processed food. Their produce and fresh meat sections are relatively small to the overall store.

These processed foods are largely made overseas. Check the county of origin on most of the processed food you'll see it comes from thailand, mexico, china, italy, etc. Little if any is local.

Many of the foods are derivative of other brands. Trader Joes basically rips off the design and inspiration of other companies to come up with their poor generic version.

They are non union - you can always support unions by shopping at a Union store.
http://www.dw.de/the-american-way-of-aldi/a-1091106-1

"one-stop shopping for "Bourgeois Bohemians"

[Beaverhausen]

14. you are missing a big part of their story and history

http://en.wikipedia.org/wiki/Trader_Joe%27s

TJs treats their workers well and has very low turnover.

[Jesus Malverde]

17. Which workers?

The many workers that assemble "Trader Joe's Salmon Fillet stuffed with Oregon Bay Shrimp, Cucumbers, and Dill" or the few workers who stock the shelves and run the registers. The workers you see are but a small part of their workforce, considering almost all items in the store are TJ branded.

[bklyncowgirl]

40. Aldi's actually pays better than other retail stores for part time workers in my area. $11.95/hr

I'll admit that I shop there and at Trader Joes. Trader Joes has affordable gluten-free products. As a person with celiac disease. I appreciate that.

[pnwmom]

8. Actually, this will be a good thing for SOME of them.

It will make them eligible for a choice of policies, rather than whatever TJ's has been providing -- and will make lower income workers eligible for the credits/subsidies that are only available on the exchange.

[Safetykitten]

15. so now that we have heard from the comfortably insured...

And how wonderful it is to be in this new land of getting insurance...why don't all you just drop yours and go through what they will....any takers?

[zipplewrath]

18. Not that simple

I understand your sentiment, and I'm not a huge Obamacare supporter, but this move isn't easy to categorize. These are extremely low annual income people (potentially). So they'll qualify for significant subsidies (depending upon if they are married to someone also making a salary). Also, without knowing what their current health care plan looks like, it is hard to compare that to the costs they'll incurr in the exchanges.

By NOT extending them health insurance, it makes these employees eligible for the exchanges, otherwise they would not. It also makes them eligible for subsidies. There is a decent chance that overall this is a zero sum gain for the employees (the cost won't change much). It could easily be better for the exchanges (because it will direct otherwise healthy people into them). And there are some employees that might end up with measurably better health insurance. It is also true though that there could be unique circumstances that could screw over individuals because of some paricular circumstance (mostly having to do with being married to someone who will prevent them from getting subsidies or being eligible for the exchanges).

[Safetykitten]

20. Oh, I see...the whole point of the ACA was to wipe people off the rolls of corporations that gave HC

Now I get it. All those savings, well it will take less people to administer the plans, less paperwork, because only full timers will have jobs...oh wait, that lie, about the shedding of full timers to part time, that's a natural thing, a lie, but anyhoo....

So the costs go down because everyone part time that had benefits will not have benefits through Wholefoods, so I suppose there will be price reductions in products, oh wait...this is Wholefoods and we LOVE Wholefoods, because it gives us Democrats the easy comfortable feeling that the people slaving away at now all part-time jobs LOVE it there, and WE LOVE it there, and we are doing so much good, so much good it makes us want to shop. And us "progressives" LOVE to shop where we don't see the icky end of stuff, only the promises. And the big promise is that the savings will be maybe put into higher wages for the part-timers, but if they don't that's ok too because they work at WHOLEFOODS and we love it. It's kinda like a hippy joint that actually makes money and cares that things are clean, not like some real hippy joint from the 70's.

Well again, the ACA contingent, made up of HC insurance haves, is telling the soon to be havenots what a fucking DEAL this is!

[area51]

49. +1 n/t

[zipplewrath]

58. You'd have to know what they had

I'm not some big ACA booster by any stretch. And I think some of what you're suggesting is true, in terms of legitimate criticism of ACA. All I was really pointing out is that for the individuals involved at Trade Joes, it may end up being close to a zero sum gain. Maybe even an improvement for them. Without knowing what their current costs are, and what the benefits were worth, it's hard to know. But subsidized coverage for health care insurance off of an exchange could easily be better/cheaper for someone than their current part time health insurance benefit. But I'll be the first to admit that it is unlikely to be some huge improvement. It's probably marginal at best for many of them, and for some things could get worse.

[leftstreet]

24. They'll be losing theirs soon enough

Obamacare attempts to change this dynamic. Under the law, health plans that cost over $10,200 for an individual or $27,500 for a family will have to pay an excise tax of 40 percent on every dollar that they exceed that cutoff beginning in 2018. As Jonathan Gruber, an MIT economics professor who helped design the law, explained to the New York Times, the tax is meant to reorient the way that employers approach their workers’ health problems and their associated costs. “It’s focusing employers on cost control, not slashing,” said Gruber.
http://thinkprogress.org/health/2013/05/28/2064441/employers-obamacare-cut-wasteful-spending/

9: What is a “Cadillac Health Plan”?

The PPACA imposes a 40 percent excise tax on “Cadillac” health insurance plans. This new tax will apply to health plans valued in excess of $10,200 for individuals and $27,500 for families. Those thresholds will grow annually by inflation plus 1 percent. The tax takes effect in 2018.
http://www.cpehr.com/affordable-care-act-obamacare-for-business

How Obamacare Is Encouraging Employers To Cut Wasteful Spending And Promote Workers’ Health

By Sy Mukherjee on May 28, 2013 at 4:05 pm

In an effort to cut wasteful U.S. medical spending, certain employers will be scaling back expensive health plans available to their employees and encouraging workers to pursue more preventative and ongoing primary care. The move is being prompted by Obamacare provisions that encourage a more cost-sensitive and efficient approach to Americans’ health care than the status quo.

Recently-released government data shows that Americans’ medical bills are completely random, with some hospitals charging as much as $100,000 more for the same services performed at other facilities. In turn, that drives up the costs of many private health plans, and increases companies’ spending on employer-sponsored insurance.

Obamacare attempts to change this dynamic. Under the law, health plans that cost over $10,200 for an individual or $27,500 for a family will have to pay an excise tax of 40 percent on every dollar that they exceed that cutoff beginning in 2018. As Jonathan Gruber, an MIT economics professor who helped design the law, explained to the New York Times, the tax is meant to reorient the way that employers approach their workers’ health problems and their associated costs. “It’s focusing employers on cost control, not slashing,” said Gruber.

Companies aren’t waiting until 2018 to shift their health care models. Some are increasing their use of high-deductible health plans (HDHPs) — which charge workers low monthly premiums but high annual deductibles — in an effort to raise employees’ awareness of how much their health care consumption costs.

http://thinkprogress.org/health/2013/05/28/2064441/employers-obamacare-cut-wasteful-spending/

The Democrats obviously figure they'll hold no majorities in 2018, when the blame-gaming begins

[Nye Bevan]

21. The more companies drop employer-provided health insurance, the closer we get to single payer (nt)

[Safetykitten]

22. Ya know...people's lives are not toys for failure.

[Nye Bevan]

23. I get the feeling that you don't really understand the ACA.

All of these folk are guaranteed to be able to obtain affordable health insurance.

[Safetykitten]

26. I get the feeling you have insurance and don't give a shit.

[Nye Bevan]

27. On the contrary, I'm happy that the ACA guarantees them affordable coverage,

regardless of any pre-existing condition.

[Safetykitten]

44. I am so happy for the littlepeople...I have insurance...that kind of happy?

[Lee-Lee]

61. Yeah, "affordable", unless it isn't...

With what rates have been published here in NC those part time workers are looking at $75 or so a month out of pocket.

Sounds great- except that rate is for a plan that only covers 60% of expenses. The other 40% is out of pocket.

So get sick or hurt badly, and that 40% still bankrupts you. At part time Trade Joe wages, just break a bone and that 40% will bankrupt them.

[Nuclear Unicorn]

33. There's a campaign pitch --

"Hi! Remember me? I'm that politician who cost you your insurance with that health care plan I told you last time was so important. Well, that was all part of the plan. Now that you and tens of millions of other Americans have no insurance I want to use you to leverage a new, better plan through congress which was really my clever ruse all along.

"Are ya with me?"

[Nye Bevan]

34. Looks like someone else doesn't understand the ACA.

Starting on Jan 1, 2014, there is absolutely no reason for anyone not to have insurance. Everyone is guaranteed affordable coverage.

Try not to believe everything Boehner and Cantor tell you.

[Nuclear Unicorn]

35. You just got done saying more companies dropping employees hastened SP.

Why would we need SP if everyone is guaranteed coverage even after their employer dumps them?

[Nye Bevan]

37. Imagine if nobody has employer-provided insurance.

Everyone is writing a monthly check to an insurance company to get a policy under the ACA. This works, everyone is paying a premium based upon their income, everyone gets a policy that is standardized in terms of deductibles, copays and essential benefits. So then the case to cut out the extra bureaucratic, profit-making layer of the insurance companies becomes compelling. Just pay the premium directly via taxes (instead of a complicated scheme of premiums and tax credits) and keep the same standardized policies.

As Paul Krugman says, the ACA is a jury-rigged imperfect approximation of a single payer system. But what is keeping many people from advocating for true single payer is that their employers handle their insurance so they don't have to think about it.

[Nuclear Unicorn]

38. The electorate has to trust your competency

I just got done reading a poll that says support for the ACA is down from 51% to 39%. That's one-fifth of its support. That's cratering.

Maybe once people actually get into the exchanges things will turn around -- or maybe they won't, this is uncharted territory. But if you lose the electorate's trust because they're going through pains you never allowed them to settle upon you're asking for trouble. Add a hostile opposition party and it *could* be catastrophic.

[Nye Bevan]

39. There has been a great deal of misleading propaganda and misinformation,

mostly from Republican controlled states. And Obama and the Dems have not pushed back to anything near the extent I would like them to. If anything, I am surprised that the support is still as high as 39%.

The problem is that too many people have no idea what the ACA is all about. But when it takes effect it will be a different story. And the thing is, it is to a large extent irreversible, which has what has driven many of the Republicans nuts, as they fully understand this. Once medical underwriting (i.e. asking questions about your health to determine whether you will be issued a policy and/or what your premium will be) has been abolished on December 31 of this year, as it will be, I firmly believe that it is never coming back. How can any politician say they are going to vote to allow insurance companies to once again discriminate based upon pre-existing conditions? And with no medical underwriting, the individual mandate is here to stay.

And when many people are buying cheap policies on the exchange, enjoying guaranteed essential benefits (such as regular check-ups with no deductible or copay, as required by the ACA) I'm pretty sure that support will increase dramatically.

[Safetykitten]

45. Why don't you just drop yours and see what it's like?

[Nye Bevan]

47. Disappointing to see DUers falling for the Boehner-Cantor scare tactics.

I bet just as many people trash the ACA here as on the RW boards.

[HockeyMom]

28. Medicare is better than what my school district insurance was

It was so bad I was thinking of dropping it totally, but quit. $160/month for individual with a $3,500 deductible and 50% payment after. WHO has $3,500 a year medical bills? I was 63 and certainly didn't. For all these corps dropping spouse coverage? That was $500 a month with same deductibles. Kids? That was $700 a month. I don't know anyone who coveres their spouse or kids under their insurance. Oh, this not not include scripts or anything else. My husband's private employer insurance was similar, and when I quit my job, we could not afford for him to cover me. I did without any coverage for 2 years. Fortunately, even at my age I have no medical issues. However, I am very happy that I will be covered by Medicare this year. Yeah, yeah, yeah, it doesn't pay "everything" as they say, but it pays a hell of a lot more than either of our private employer insurance did. (All)Insurance in Florida really sucks, big time. I am from NY.

[Sheepshank]

32. Jesus, are you saying this is a good or a bad thing? n/t

[Jesus Malverde]

43. Not sure one way or another..nt

[dionysus]

36. if the workers can get plans under ObamaCare, surely Trader Joes will use the money saved to give

the employees raises of the same amount.. right?

[Safetykitten]

46. Oh yes! The savings! What a day that will be, when they raise the hourly part-time people's

wages. Huzzah for the ACA! Who knew that ALL that money saved would be going into the pockets of the employees?

Why the ACA people did! Right? That money? Millions? Higher wages? Of course it is!

[Recursion]

51. It said they're giving them each a $500 subsidy

No idea whether that's more or less than the company was spending per employee on insurance.

[B Calm]

53. I'm sure they will, LOL

[kalisto2010]

48. bs

Employers are just using this as an excuse to drop medical coverage. Then blame it on Obamacare.

[Recursion]

50. So they're subsidizing their part time workers' exchange purchases? Awesome.

I don't see what's bad about this.

[Tigress DEM]

52. I "get it" Here's 6 words "It's like Walmart/Food Stamps"

Maybe Trader Joe's isn't as big or as bad as Walmart, but with this act they need to be watched.

Some of their behavior is good. They do treat many of their workers well.

But all over the Right Wing Network this is the meme --- OMGarsh, companies can't AFFORD to offer health insurance if the Gov'ment gets into the act.

[Barack_America]

60. It's actually great news for these workers.

Now their entire families will qualify for the exchanges, and they won't get screwed over by the ACA's "family glitch"