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Blue The Nation | September 1, 2014

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Local Focus: California Attempts to Close the Wal-Mart Health Care Loophole

Local Focus: California Attempts to Close the Wal-Mart Health Care Loophole
Jonathan Nathan

Ever since the Affordable Care Act–which seems destined, at this point, to be forever known as ObamaCare–was passed and signed into law, critics on the left have been eager to point out its many shortcomings. One of the biggest is the so-called “Wal-Mart loophole.” Because the ACA doesn’t require companies to provide health care for part-time workers or for workers with wages so low that they qualify for Medicaid–which is, itself, expanding in most states due to the ACA–Wal-Mart and other massive corporations are simply cutting hours and wages. As the California Labor Federation points out, this allows Wal-Mart and its ilk to “fail to provide benefits are able to evade the ACA penalties and shift the cost of health coverage for their employees onto taxpayers.”

Of course, it’s important to note that Wal-Mart’s history as a corporate welfare queen is long. In California alone, the discount chain’s abysmal practices were already costing the state’s various pubic assistance programs more than $85 million every year before the law went into effect. Other companies that also engage in similar practices push that price tag even higher. As Wal-Mart and other companies slash wages and hours even more, and as Medicaid expands in most states, the national cost to taxpayers of these companies’ negligence will easily push past $3 billion a year.

So California Democrats attempted to do something about it by heading the problem off in a state that’s home to one out of eight Americans. Assembly Bill 880 would have fined companies with more than 50 employees as much as $5,000 for each employee on Medi-Cal, the state’s Medicaid program. Essentially, the bill forced companies to pick between six of one and a half-dozen of the other: either pay for their healthcare up front, or pay for the healthcare we, the taxpayers, have to provide for them due to your moral failings.

Fortunately, Republicans and conservative Democrats selflessly chose to torpedo the bill. It needed a two-thirds supermajority vote to pass, which shouldn’t have been a problem since the Democrats have such a supermajority. Instead, seven Democrats joined with the staunchly obstructionist Republican caucus in the Assembly to kill the bill. This really doesn’t make much sense, because conservatives are supposed to be about saving the taxpayers money. This bill would have saved billions of taxpayer dollars over the course of just a few years, and would have continued to do so ad infinitum. By some estimates, the bill could literally have saved the state billions of dollars every single year.

All hope isn’t completely lost; the bill will likely be brought back up in August after the legislative recess. But in order to pass, it will require the support of some conservatives, and that’s apparently hard to come by.

I guess conservatives only like saving money if in doing so, they can also take away the services that save and improve the lives of poor people. Conservatives, everybody: They hate welfare queens when they’re human beings just trying to scrape by, but they love welfare queens when they’re objectively wicked companies like Wal-Mart just trying to screw their workers out of a decent life.