Walgreens Healthcare Decision a Study in Employee Communications

Image: Phillip Pessar
Image: Phillip Pessar

It was widely reported today that Walgreens is moving 120,000 employees to a private health insurance exchange from coverage that’s provided directly from carriers.

In other words, Walgreens is giving its workers a fixed amount of money to spend at a private insurance exchange (rather than provide insurance through a company plan) in an effort to reduce the company’s burgeoning healthcare costs.

Jill Schlesinger, a CBS News analyst, explained the move: "They're saying, Well, it costs the same amount of money for the company today, but by giving you a fixed amount of money, it protects them against rising healthcare costs in the future."

Walgreens' decision, which earned the company The Wall Street Journal headline "Walgreen to Give Workers Payments to Buy Health Plans," isn't viewed as a generous adjustment by others.

Tom Murphy, from The Huffington Post, issued the following point: "Workers who use these exchanges can wind up paying a bigger share of the insurance bill for their coverage over time if the contribution from their company doesn't climb to keep up with insurance costs or the worker doesn't chose a cheaper plan."

So is Walgreens a progressive company following in the steps of 17 other businesses (including Time Warner, International Business Machines (IBM) and Sears Holding)? Or is it an insensitive retailer attempting to cut corners at the cost of its employees? The way this message comes across is in the hands of Walgreens’ PR team. Regardless of your political bent, it will be interesting to see how this plays out.

Follow Lucia Davis: @LKCDavis.