In an announcement today, Walgreens outlined their intent to shift their more than 160,000 employees away from provided health plans to "employer-sponsored health insurance coverage." Walgreens joins a growing group of large companies--including IBM, Time Warner, and Sears--who are shifting to this model of health benefit, turning away from the more traditional model of medical benefits in favor of providing the the fixed-stipend to employees who then buy their own health insurance.
Like other companies, Walgreens points to the additional choices this affords employees in deciding what is best for them and provides an opportunity for lower out-of-pocket health care costs.
“Under this new program, employees will have expanded choices to personalize their health care coverage in a competitive environment, giving our diverse workforce the flexibility they need to meet their health care needs,” said Kathleen Wilson-Thompson, Walgreens senior vice president and chief human resources officer. “We will continue to invest in the health of our employees and their dependents while using a marketplace solution that offers a wide variety of plan options that meet the affordability standard of the Patient Protection and Affordable Care Act.”
Critics are quick to point out that by moving employees to the private exchange it's a way to freeze the amount of money the company will spend on healthcare. Flat-rate payments to employees are not guaranteed to keep up with inflation rates in the future.