Trader Joe’s is set to discontinue healthcare benefits offered to its part-time employees, opting to give employees who work less than 30 hours a week a check for $500 in January and assistance in finding new coverage under the Affordable Care Act (also known as Obamacare). While some see the company’s decision as another example of how Obamacare is forcing companies to drop healthcare coverage, others see it as a success for the President’s new health care reforms.
Trader Joe’s has been widely regarded as the holy grail of part-time employers because it is among only a few companies that offer medical, dental, and vision plans to part-time workers. And even those who do offer coverage to part-time employees tend to offer it at pretty astronomical rates. In a memo dated Aug. 30, Trader Joe's CEO Dan Bane said the company made the decision in the interest of its employees.
“We believe that with the $500 from Trader Joe's and the tax credits available under the [Affordable Care Act] , many of you should be able to obtain health care coverage at very little if any net cost to you," Bane wrote in the memo.
So is this a success or a failure for Obamacare? Sy Mukherjee, a contributor to ThinkProgress, thinks that the decision from Trader Joe’s actually means Obamacare is working.
“Now, employers like Trader Joe’s don’t have to offer health coverage to Americans at these income levels anymore. That’s because the employees will soon have a place to buy affordable insurance: Obamacare’s statewide marketplaces,” wrote Mukherjee. “Plans sold through the marketplaces must offer robust benefits across ten broad categories, including for hospital visits, mental health services, and prescription drug coverage.”
One worker, speaking with the Huffington Post, expressed that she was anxious about how the company’s decision would impact her coverage. Last year, she made less than $20,000 working part-time at Trader Joe’s. She fears that she will not be able to afford health care under the Affordable Care Act.
"I still have so much anxiety over this, worrying will I have coverage, will it be equivalent, and how do I factor this into my budget," she said. "I'm a full-time student living alone. Everything in my budget is extremely tight. This is something that's throwing a wrench into everything."
Over the next three months, Trader Joe’s will take steps to determine whether employees who work more than 30 hours a week will also be forced to participate in Obamacare’s healthcare exchanges.