Wal-Mart expands health coverage

— -- Wal-Mart, whose health coverage for employees has been a target of critics, says it will offer improved options for workers next year that include $4 generic drugs and monthly premium costs of as low as $4.36 on some of its plans.

The company drew criticism from unions — and some state lawmakers — in recent years for its coverage, which critics called unaffordable for some of its 1.3 million workers, causing them to be uninsured or enroll in government programs such as Medicaid.

Starting in January, workers will be able to mix-and-match up to 50 different combinations of deductibles, credits and premiums, which the company says should help boost enrollment. Last year, Wal-Mart wmt said 43% of its workers had health insurance through the company, although a full 90% had some coverage, through spouses, parents or government.

"It's hard to see why an associate would not choose health coverage when we have plans as low as $4.36 to $7.31," says Wal-Mart spokeswoman Sarah Clark.

The new plans will offer:

•A choice between four annual deductibles: $350, $500, $1,000 or $2,000, a change from this year when plans had annual deductibles of $1,000 or $2,000. The amount paid by workers for monthly premiums increases as the deductible goes down.

•To offset those deductibles, employees can choose between $100, $250 or $500 "credits" Wal-Mart will pay for medical care before the worker pays the deductible. The higher the credit, the higher the premium.

•Co-payments of $4 for 2,400 generic drugs.

•No lifetime maximum on most plans for the amount the insurer will pay toward catastrophic medical needs. The maximum workers would pay each year, after their deductibles, toward medical costs would be capped at $2,000 or $5,000.

The proposal drew faint praise from one union-backed advocacy group.

"The coverage changes for the more expensive health care plans show signs of improvement and demonstrate the company is listening. … But, for the vast majority of Wal-Mart workers, who struggle to get by on an average annual salary of $18,800, these plans are still unaffordable," said Wal-Mart Watch Executive Director David Nassar in a written statement.

Wal-Mart said a worker choosing a plan with a $1,000 annual deductible and a $250 credit toward that deductible would pay $11.55 a month to $42.70, based on where they live and what kind of annual out-of-pocket maximum they choose. The $4.36 to $7.31 a month plan has a $2,000 deductible and a $100 credit, and the worker would be liable for up to $5,000 in additional costs for catastrophic medical expenses.

That the plans have no lifetime maximum on benefit payouts will help protect people from bankruptcy, says Dallas Salisbury, president of the Employee Benefits Research Institute. "Wal-Mart is moving in the direction of far more complete coverage at lower premiums with greater flexibility," he says.