By John Wagner
Washington Post Staff Writer
Friday, January 13, 2006; A01

Maryland lawmakers bucked the will of the state's Republican governor and the nation's largest retailer yesterday, voting to become the first state to effectively require that Wal-Mart spend more on employee health care.

In a veto reversal that was closely watched nationally, lawmakers in the Democrat-led General Assembly voted largely along party lines for a measure that legislatures in more than 30 states are considering replicating.

"Maryland is not a shrinking violet -- no, far from it," said Sen. Gloria G. Lawlah (D-Prince George's), a lead sponsor of the legislation, which drew strong backing from labor unions and health care advocates. "Maryland is a leader. Let us light the torch today. Let us lead."

The Senate voted 30-17 for the bill after a filibuster attempt by Republicans. The House followed last night with an 88-50 vote that handed Gov. Robert L. Ehrlich Jr. (R) a defeat early in the legislative session on a bill he argues is an unwarranted government intrusion into business.

The bill will require private companies with more than 10,000 employees in Maryland to spend at least 8 percent of their payroll on employee health benefits or make a contribution to the state's insurance program for the poor. Wal-Mart, which employs about 17,000 Marylanders, is the only known company of such size that does not meet that spending requirement.

Wal-Mart spokesman Nate Hurst said the votes were driven by "partisan politics."

"This vote was never about health care," Hurst said. "In allowing a bad bill to become a bad law, the General Assembly took a giant step backward and placed the special interests of Washington, D.C., union leaders ahead of the well-being of the people they serve. And that's wrong."

Hurst said the company's lawyers were certain to look into questions raised by business groups about whether the bill violates federal law. The Maryland Attorney General's Office issued an opinion this week dismissing those concerns.

The legislation has resonated in Maryland and beyond in part because it is viewed as a relatively easy and inexpensive way for lawmakers to expand access to health care and because Wal-Mart, a company with a reputation for stingy benefits, is considered an easy target.

"We don't want to kill this giant. We want this giant to behave itself," said Del. Anne Healey (D-Prince George's County), the lead sponsor in the House. "We want this giant not to be a bully."

The bill drew spirited opposition from Republican legislators, who argued that supporters were trying to punish an unpopular company and help its unionized rivals. Opponents also predicted that lawmakers would gradually expand the bill to include smaller businesses.

"This is a revenge bill," said Sen. E.J. Pipkin (R-Queen Anne's). "This isn't about health care."

Democratic lawmakers countered that the bill was intended to make large employers pay their "fair share" of health costs. Wal-Mart says that more than three-quarters of its sales associates have health insurance but acknowledged that some of its low-wage workers are on Medicaid, the state insurance program for the poor.

Sen. Paul G. Pinsky (D-Prince George's) argued that the bill would "take people who should be getting health care at the workplace off the rolls."

Ehrlich's chief of staff, Chip DiPaula, said last night that lawmakers had started "marching down the road to socialized medicine.

"The governor thought it was terrible public policy, but we're done. We're over it," DiPaula said.

Supporters predicted that Maryland's success would give a lift to similar legislative initiatives elsewhere. Vincent DeMarco, who lobbied for the bill as president of the Maryland Citizens' Health Initiative, said he has been invited to speak to several national groups about Maryland's experience.

"This is going to sweep the nation because people have been looking for a way to expand health care access and spread the burden," DeMarco said.

Ron Pollack, executive director of Families USA, a national health care advocacy group, said some initiatives that have emerged in other states are more expansive than Maryland's, affecting more than just the largest employers.

Bruce Josten of the U.S. Chamber of Commerce said he could not predict what other states would do. But Josten said Maryland's approach "completely misses the mark."

Josten said that roughly 25 million of the more than 45 million uninsured Americans work for companies with 10 or fewer employees. "This in no way gets to the root of the problem," he said.

Hurst said there are 786,000 uninsured people in Maryland, and fewer than one-half of 1 percent of them work for Wal-Mart.

The bill prompted frantic lobbying in recent weeks, with unions and health care advocates airing radio and television ads and Wal-Mart running full-page ads in major newspapers. The company also bulked up its lobbying corps in Annapolis, hiring at least 12 lobbyists, whom Pinsky derisively called the Dirty Dozen during yesterday's debate.

The Annapolis press corps was swollen with members of the national media, and immediately after the House vote, Busch was whisked outside the State House for a national television interview.

The whoops and cheers of advocates echoed in the vast hallway outside the House chamber. Union members and their lobbyists hugged lawmakers and posed for photos, giving a thumbs-up, some with tears in their eyes. "We prevailed. Yes!" said an exuberant Del. Veronica L. Turner (D-Prince George's).

Ehrlich vetoed the bill last spring after the legislative session ended.

In the interim, Wal-Mart announced an overhaul of health care options for its employees, including a plan that it said costs $23 a month for a single worker.

The Senate's vote to override Ehrlich's veto met the three-fifths requirement with one vote to spare. The only Democrats who broke with their party were three senators representing Anne Arundel County, a relatively conservative jurisdiction. All 14 of the chamber's Republicans voted against the bill.

In the House, Democrats had a harder time harnessing the votes needed. But by early yesterday, House Speaker Michael E. Busch (D-Anne Arundel) said he felt certain he had reached the critical number: 85.

Lawmakers also maneuvered yesterday to override other Ehrlich vetoes, including a $1 increase in the minimum wage. The House passed the measure, and the Senate could do the same Tuesday. The Senate, meanwhile, overrode Ehrlich vetoes of bills that would allow early voting in this year's election and would seek to address voter intimidation.

Staff writers Matthew Mosk and Ann E. Marimow contributed to this report.