It was only a matter of time: Rhode Island is joining the Wal-Mart wars. Across the country, states are trying to crack down on companies that, like the retail giant, skimp on health benefits and then let their workers and their children rely on Medicaid and charity care.
So far, two proposals are on the table in Rhode Island. One, sponsored by state Rep. Eileen Naughton, D-Warwick, would require the state Department of Human Services to report to the Legislature any employers who have 25 or more workers either directly on Medicaid, or with children on Medicaid.
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The second measure, backed by Rhode Island for Health Care, several unions, and Lt. Gov. Charles Fogarty, would go much further. It would require all companies with 1,000 or more workers to spend at least 8 percent of their payroll on their employees’ health care, or else pay into a state fund to cover more Rhode Islanders.
The concept behind both proposals is attractive not just to consumers, but to every business owner who’s ever struggled to pay health premiums: It seems odd that big, successful companies are in effect allowed to receive a taxpayer subsidy to keep their costs down.
But this is tricky territory, and in the end, we cannot endorse either of these measures.
The first one is meant to target supposed villains like Wal-Mart, but it could really affect anyone who hires anyone living in or close to poverty.
Is it really shameful for, say, a Dunkin’ Donuts franchise not to provide benefits, especially to part-timers? Wouldn’t it be much worse if suddenly those stores stopped hiring moms with Medicaid-eligible children trying to earn their GEDs, and instead took only high school students and senior citizens?
The same goes for retail businesses, many of which allow workers to rise through the ranks and get full-time jobs with benefits as they gain skills and experience. Let’s not discourage them. If anything, we should support the work the DHS has been doing in reaching out to those companies and get them to sign up for RIte Share, the state subsidy program that helps poor workers to pay their part of employer-sponsored health insurance premiums.
As for the 8-percent legislation, we need only ask, why should an arbitrary cutoff like that be imposed?
So an employer that pays minimum wage must spend 8 percent of its payroll, and an employer that pays, on average, $25 or $35 or $50 an hour must do the same? Does this mean high-paying employers must provide Cadillac benefits or else? That’s nonsense.
A better argument could be made to require that employers at a certain level provide a minimum set of benefits, if we were inclined to make it. At the very least, it would make a good topic of conversation with Health Insurance Commissioner Christopher F. Koller.
Then again, it’s an election year. We’re not going to hold our breath for real policy debates.
