Walgreen Will Shift Employees To On-Line Exchanges Under ObamaCare

The Wall Street Journal is reporting:

Walgreen Co is set to become one of the largest employers yet to make sweeping changes to company-backed health programs. On Wednesday, the drugstore giant is expected to disclose a plan to provide payments to eligible employees for the subsidized purchase of insurance starting in 2014. The plan will affect roughly 160,000 employees, and will require them to shop for coverage on a private health-insurance marketplace. Aside from rising health-care costs, the company cited compliance-related expenses associated with the new law as a reason for the switch.

Under Walgreen's new arrangement, to take effect in 2014, the firm will pay a fixed amount for employees to select coverage options in a private insurance exchange run by Aon Hewitt, a consulting unit of Aon PLC. The exchange will offer up to 25 different plans in some states.

The options include HMO-style coverage with no deductibles and lower out-of-pocket costs than some plans. Also available are bare-bones plans with higher deductibles and leaner coverage. Workers could have premiums costing as little as $5 a month, Walgreen says, to appeal to the 36% of its employees who are single and under 30 years old.

It isn't clear how much money the move might ultimately save Walgreen or whether its workers will face higher costs. Mark Englizian, Walgreen's vice president of compensation and benefits, said the submitted bids for monthly premiums for the private exchanges were roughly equal to its current 2013 rates—meaning some savings could come from the fact the bids didn't factor in year-over-year increases.

Mr. Englizian said another reason behind the private-exchange decision was offering employees more health insurance options.

I knew there would be a work-around. Do you remember the McDonald's franchisees going to Washington, DC, yesterday to "plead" for relief from ObamaCare? They won't get relief, and McDonald's will do the same thing Walgreen has done.

It's nice to see that this decision will give employees an opportunity to explore more health insurance options. 

Again, for investors, ObamaCare will work out very nicely. I think that's one of the reasons Republicans are divided on whether to defund ObamaCare. Everyone knows corporations have seen escalating health care costs; ObamaCare will do two things for them:

• a) allow them to budget 
• b) shift costs

Note: there are insurance policies out there with premiums as little as $5 / month. Can't beat that.