Starting January 1st, just as insurance plans sold on the Affordable Care Act’s health-insurance exchanges go into effect, Trader Joe’s will cut health insurance benefits for employees working fewer than 30 hours a week, according to Bloomberg.com. Instead, TJs will give them each $500 to purchase health insurance elsewhere.
“Depending on income earned outside of Trader Joe’s, we believe that with the $500 from Trader Joe’s and the tax credits available under the ACA, many crew members should be able to obtain health care coverage at very little, if any, net cost,” the company said Thursday in a statement.
Trader Joe’s said that 77 percent of its employees will not lose their company-sponsored health plan. And for those who do lose their coverage, it estimates that roughly 70 percent will be able to get the same level of coverage at a lower price through the health-care exchanges enacted under Obamacare.
The company cited the example of an employee who worked 25 hours a week and now pays $166.50 per month for insurance through Trader Joe’s plan. On the exchange, she could find “comparable coverage” for $69.59 a month, the company said. That, combined with Trader Joe’s $500 contribution, would translate to a savings for the employee of $1,675 next year, the company said.
The senior VP of the Kaiser Family Foundation told Bloomberg that the Trader Joe’s decision will likely end up being the exception rather than the rule for companies and employees as Obamacare shakes out. Why? Because most companies don’t offer health insurance to part-time employees, anyway.
Phot via Flickr user Joe+Jeanette Archie