NEW YORK — Walgreen Co., the biggest U.S. drugstore chain, will move its workers into a private health insurance exchange to buy company-subsidized coverage, the latest sign of how the debate over Obamacare is accelerating a historic shift in corporate health-care coverage.
About 160,000 Walgreen employees have to choose which coverage plan suits them best at a time of rising complexity in the health care system. While Walgreen said it will provide funding in 2014 equal to what workers get now, the move curtails uncertainty on future outlays, and there’s no guarantee its contribution will rise if premiums do.
Walgreen joins Sears Holdings Corp. and Darden Restaurants Inc. in a private exchange run by Aon that includes 18 companies and 600,000 people, Aon said. While the private effort isn’t directly linked to Obamacare, the growing use of private exchanges similar to the law’s public ones adds new fodder to the debate over the law’s influence.
“For a while, large employers have been moving in this direction,” said Thomas Buchmueller, a professor at the University of Michigan’s Ross School of Business in Ann Arbor, by telephone. “After the legislation was passed, they looked at the exchanges and said, ‘This is something we can do.’ ”
Michael Polzin, a spokesman for Deerfield, Ill.-based Walgreen, denied that his company’s move was driven by the Affordable Care Act’s 2010 passage and provisions, saying, “It’s something we’ve been looking at very closely in the last couple years.”
“It’s hard to link the two,” Polzin said in a telephone interview. “We want to continue to be very innovative in the health care we’re providing employees, just as we’re innovative as a health-care provider.”
The options offered by the private exchange offer similar levels of coverage to those in the Affordable Care Act’s public exchanges, though workers will get their subsidies from their companies instead of the government, said Ken Sperling of Aon.
Other large employers, including IBM Corp. and Time Warner, have this year moved their retirees into private exchanges from company-picked plans. Trader Joe’s Co., the closely held grocery store chain, has said it will move part-time workers at its 400 stores onto the Obamacare exchanges, and United Parcel Service Inc. decided to drop health benefits for 15,000 of its workers’ spouses who can get insurance through another company. Previously, Walgreen had two insurers each offering two plans, for four total options, Polzin said. The Aon exchange has five insurers each offering five different plans. Under the private exchange system, companies give workers a subsidy, and the employee will make up any difference in cost for more complex coverage.