Big US companies on Thursday night faced the first employment tax aimed at plugging gaps in the public healthcare system after politicians in Maryland passed controversial “fair-share” legislation.
The bill, aimed almost exclusively at Wal-Mart, calls on companies with more than 10,000 employees in the state to spend at least 8 per cent of their payroll on health insurance or make up any shortfall with a contribution towards health schemes that are publicy run.
Wal-Mart is the only company in Maryland likely to be caught by the law and business groups blame its passage on a union-led vendetta against the non-unionised retailer.
But the Democrat-led vote – overturning a veto by Maryland’s Republican governor – also marks a milestone in the growing struggle between employers and politicians over who should carry the spiralling cost of healthcare.
Further indications of the interest of politicians in covering healthcare costs came this week from the right.
In a sign of the growing awareness among US politicians that they must address the issue, two potential 2008 Republican presidential candidates have sought advice from a man who was a top health policy officialduring the Clinton administration.
Len Nichols, senior advisor for health policy at the Office of Managment and Budget during the ill-fated push for near-universal health coverage, said the two Republicans – whom he refused to name – recognised that “this could be a huge issue in 2008, and we have to be prepared”.
President George W. Bush also said this week that healthcare was becoming “an unmanageable cost”, especially for small businesses, and called on Congress to expand the use of health savings accounts, which allow individuals to set aside money tax-free to pay certain health costs.
Nevertheless, the passage of legislation in Maryland – after narrow votes in the state senate and house of delegates – is the furthest US politicians have ever gone in intervening in employee health insurance.
Wal-Mart said the bill set a dangerous precedent and could force it to rethink plans for a distribution centre in Maryland that would create 800 jobs.
“It singles out one company at the interest of organised labour,’’ it said. “Businesses across the US will think twice about expanding in a state like Maryland.”
The Maryland Chamber of Commerce has hinted at a possible legal challenge.
The legislation also represents a major escalation in union-led campaigns against the retailer and its employment practices.
