More than 1 million people nationwide have mini-med plans. They are typically low-wage retail workers who pay between $10 and $20 per pay period for a plan with an annual coverage cap of $2,000. In 2014, these plans will be phased out as individuals can begin purchasing coverage through state insurance exchanges. Additionally, the HHS last week granted waivers to about 100 employers and insurers offering mini-med plans, allowing them a one-year pass on a requirement in the health reform law that they spend 80% to 85% of member premiums on direct healthcare starting in 2011.
McDonald’s has worked hard to find affordable health insurance for hourly workers, testified Richard Floersch, executive vice president for human resources at the fast-food giant. McDonald’s offers three mini-med plans and more comprehensive insurance. About 90% of covered workers don’t reach annual limits, Floersch said. “We cannot control the rising costs of healthcare,” he said.
Sen. Barbara Boxer (D-Calif.) lambasted McDonald’s for picking up only 10% to 20% total premiums for their hourly workers, but paying 80% of total premiums for corporate employees. “I think you ought to take a look at that,” Boxer said. “That just makes my heart beat fast, and not in a good way.”
Sen. Kay Bailey Hutchison (R-Texas) countered that mini-med plans are better than no insurance. “It’s an option that could create no option if eliminated,” she said.