Target to Part-Timers: Get Obamacare

Image: MGN Online

Image: MGN Online

NEW YORK (CNNMoney) – Following in the footsteps of several retail peers, Target has announced it will no longer offer health insurance to part-time workers. Instead, it will encourage them to sign up for Obamacare.

Target (TGT, Fortune 500) said fewer than 10% of its total workforce of 361,000 participate in the existing part-time plan, in an online notice posted Tuesday. Some part-timers can find cheaper coverage on the Obamacare exchanges.

“By offering them insurance, we could actually disqualify many of them from being eligible for newly available subsidies that could reduce their overall health insurance expense,” the post said.

Target would not release an exact count of part-time workers, saying the number fluctuates often, according to a company spokesperson.

The launch of the Obamacare exchanges, which offer premium subsidies for individuals making less than $46,000 a year and families of four earning $94,200, has led some employers to reevaluate their coverage. Home Depot (HD, Fortune 500) and Trader Joe’s announced last year that they would stop offering coverage to part-timers.

Some experts are concerned more companies will follow suit, though for now, changes remain at the margins. Many employers don’t offer health insurance to their part-time workforce.

Starting in 2015, companies with more than 50 employees will have to provide coverage to full-time workers or face a $2,000 penalty. Most individuals, meanwhile, have to obtain health insurance this year or face apenalty of $95 or 1% of their income, whichever is greater.

Target will provide a one-time $500 cash payment to part-time workers currently enrolled in the plan, which will cease April 1. And it has hired a benefits firm to provide them with support in signing up for alternate coverage.

These employees, who work between 20 and 31 hours a week, will continue to be eligible for dental policies, along with vacation time, 401(k) benefits and disability and life insurance.

Target also said it will not limit hours of team members as a result of the benefits change.

TM & © 2014 Cable News Network, Inc., a Time Warner Company. All rights reserved.

10 comments

  • Nuclear Mike

    And so Corporate America will be soon “tossing” their health insurance costs over the “Federal fence” onto the Federal budget…

    • Wake Up

      Nuc, the ACA pays for itself. In fact, research indicates that in the long run it will help decrease the federal deficit!

      • Lisa

        To the poster Wake Up I really hope you were being facetious? The ACA pays for itself? Does it come out of Obamas secret stash?

      • Wake Up

        The fact is that the ACA is designed to pay for itself. History will show which side of this debate was correct. The South has a history of being on the wrong side of history (integration of schools, interracial marriages, worker’s rights, etc). I predict that history will also show that the South is on the wrong side of history when it comes to the ACA.

      • Lisa

        It might be designed for people that are paying into it to generate funds ,but it will never get off its feet unless it has a bail out from the tax payers and then it will still never generate enough funds to be self sustaining. What does the south have to do with it? Racist much?

  • Wake Up

    This will be great for the 90% that did not have health insurance and even better for the 10% that will now have real health insurance coverage.

  • Be Mellow

    This is yet another example of a greedy company and its moneygrubing executives pocketing the extra profits that their slave workers makes for them. but President Obama is having the last laugh on them because he is giving these slave worker the health care they deserve. and also President Obama is fighting to get the workers a just living wage which the greedy fatcat companies and the TEAS ( Total Extremeist A—) are blocking.

    • Branko Pezdi

      Another James/Wake Up. This nonsense would be funny if not for the fact that the uninformed are now controlling – and destroying – the country. [roll eyes]

  • CBC

    I’m more concerned about places like Walmart cutting employees to part-time which have always been full time to avoid paying insurance.

    Target is doing FAR more than most companies. They don’t have to provide insurance for part timers or a $500 subsidy. Part time work is genreally to subsidize4 existing income and existing benefits.
    I’m fine with them letting the part-timers buy obama care.

    • Dianne Gray (@AubLuvsDianne)

      Walmart employees who go from full-time to part-time employees and were hired before Jan. 2011 do not have to work a minimum number of hours to keep their health insurance. Employees hired from Jan. 2011 to Feb. 2012 have to average 24 hours a week. Those hired after Feb. 2012 have to average 30 hours a week. Part-time employees are eligible for health insurance after 52 weeks with the company if they average the same number of hours as above based on hire date. Of course, like just like Target as shown, this could always change.

Comments are closed.

Follow

Get every new post delivered to your Inbox.

Join 730 other followers