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Walgreen Co. Message Board

  • investorabove investorabove Oct 19, 2006 10:37 PM Flag

    Capping Wages and Limiting Health Care

    Specifically, Wal-Mart is rolling out a campaign to cap employee wages and reduce what it spends on health care benefits--by increasing its part-time workforce and pushing out longer-standing employees.

    "Given the impact of tenure on wage benefits, the cost of an associate with seven years of tenure is almost 55 percent more than the cost of an associate with one-year tenure, yet there is no difference in his or her productivity," reads an internal corporate memo leaked to the New York Times. The memo recommends hiring more part-time employees, because "the shift to more part time associates will lower Wal-Mart's health care enrollment."

    According to Wake Up Wal-Mart, a UFCW campaign exposing the company's abuses, Wal-Mart already has the highest number of workers without health care coverage of any employer--it fails to provide benefits for 775,000 employees. As a result, an average of 13 percent of its workforce has to seek assistance from the Medicare and Medicaid public health care systems.

    Now, with its new strategy getting underway, Wal-Mart has announced that it is cutting health care options for employees, meaning this situation is likely to get worse.

    Under the system outlined in the 2007 Wal-Mart Medical Benefits Booklet, new hires now get to choose between the perversely titled "Value Plan" or "Freedom Plan."

    While Wal-Mart's marketing machine is heralding a new discounted generic drug program for customers, employees opting for the "Value Plan" could be saddled with a $300 pharmacy deductible, plus additional deductibles that could conceivably total $6,000. On the other hand, the "Freedom Plan" only really offers freedom from coverage--premiums are jacked up by 6.9 percent, and getting a spouse covered will cost an $1,800 surcharge.

    According to Wake Up Wal-Mart's analysis, a family depending on one of the offered plans could pay as much as 60 percent of their income for health insurance, and a single worker could pay as much as 30 percent.

    Wal-Mart is also planning on doubling to 40 percent the percentage of its employees who are part time. This will involve forcing full-time employees with seniority off the schedule.

    Some Florida stores have reportedly begun to institute this "weed-out" program by not permitting older employees with leg or back problems from sitting on stools while working as cashiers, store greeters or fitting-room attendants--even after using them for years.

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    • You are correct Bananarug, this is VISION. Without revealing too much info, just understand that Snoot's pharmacy cranking out 800+ scripts a day is being directly assisted and supported by hundred of surrounding WAGs.

      But really, this is already old stuff. More exciting things are in the pipeline. Our competitors have no idea what they're up against. While they're throwing out gimmicks for short term attention-grabbing, WAG is laying the foundation for present and future dominance. I suggest Longs hang on to every share.

    • A heck of an ideal if you can get away with it. and WMT can, just think of all the retiree's who want a part time job and are on medicare. Financially speaking it should help improve their bottom line, as the highest cost to any business is employee healthcare. Until retiree's refuse to take these jobs and existing employee's refuse to work...WMT wins.

    • Bananarug,

      Faxing through the computer is pretty old technology for us (although cutting edge or non-existent for most of our competitors). We can include an exact image of the RX for the doctor�s office to view, as all scripts are now scanned, checked and stored digitally. That's how we're able to help check Rx's for a WAG 300 miles away when we're slow and they're busy. Other WAGs return the favor when we're busy.

      It's cutting edge technology that was fast-tracked in response to the devastation of Hurricane Katrina. Workload was instantly shifted from dead or struggling stores to surrounding healthy ones. WAG was heroic in getting folks their meds, despite the losses we took. Although you didn't here much about it in the news.

      None of our competitors are even close. They're still working on adding drive-thrus, adding 24hr stores and faxing through computer.

      Insurance issues will likely be removed all together from the store level, thanks to technology we gained from the Happy Harry's acquisition. No more dealing with insurances ... should make Eliminate happy. Oh I forgot, he's permanently miserable.

      Lot's of exciting technology in the pipeline to improve efficiency, customer service and profits. Shareholders will reap the benefits over the next decade. Longs need not worry. Just relax and let this short-term volatility play itself out.

    • Basically there are three types of insurance issues:

      1. Drug not covered: fax the doctor to have them change the drug or have them call the insurance to get approval

      2. Refill too soon: have the patient come back in a couple days when the insurance will pay up. Of course WAG does all of this with technology: leaves the patient a phone message that the Rx is not ready, automatically processes it on the scheduled date, phones the patient or emails them a message that the Rx is now ready.

      3. Insurance expired: tell the patient to give you their new insurance.

      Pretty complicated stuff Eliminate.

      And the technicians handle 90% of the phone calls .. phone calls which bring in more profit as they're either from patients needing refills or from doctors giving us new Rx's.

    • Not sure what pharmacy was like in your day, but the modern pharmacy today has things like computers, bar-codes, automation and air-conditioning.

      Oh, and just an observation: constantly talking yourself up, the great decisions you've made, justifying how your life has turned out, to faceless strangers on this board ... wow, insecurity. Ask your shrink friend.

    • That's right Eliminate. You're a smart guy, you should understand that 80% of the problem lies in the system, not the individual. Change the system, change motivations and you'll change behavior.

      Blaming everyday women or Mexicans or whoever else you like to rail on is not only ineffective, it makes you look ignorant, sexist and racist.

    • you are very wise. its good for young people to be employees, but they should understand that financial freedom is very attainable.

    • Eliminate,

      It's true that pharmacy is becoming strictly a commodity and the volume of Rx's is increasing substantially. But you are way off about the typical work conditions.

      In truth, being a pharmacist is easy. It is not physically demanding. The occasional hour of mental stress is more than compensated by the hours of slow downtime.

      A 24 year old coming out of pharmacy school today will make 6 figures. I can count on 1 hand other professional degrees that pay more, fresh out of school.

      I agree with you that at some point, it's a good idea to get out of the profession and pursue other passions. But that is true of any "employee", whether a pharmacist or a WMT cashier.

      In our system, earned income is for suckers stuck in the rat-race. Everyone should work to transition from employee to owner/investor. That is where financial freedom will be found.

      But to counsel a young pharmacist, fresh out of school with $50K in loans, to toss away $100k/year is bad advice. Better enjoy the gravy doing an easy job, while working to establish passive/investment income. Transition to part time, then retire completely sitting on a 7-8 figure portfolio.

      Your claim that you don't hate pharmacy/pharmacist, while at the same time calling them stupid slaves and prostitutes, is a bit disingenuous.

      It's obvious to all that you were stuck in some horrible work environment and with bitterness and resentment, have decided to paint the entire profession with disdain. You're not fooling anyone.

    • Bananarug,
      Excellent post from start to finish. I agree 100%!


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