Corporate Welfare: How Amazon and Walmart Use Medicaid and SNAP to Subsidize Low Wages

Working-age adults relying on federal safety net programs are predominantly employed, with major corporations like Walmart and Amazon frequently accounting for thousands of workers enrolled in Medicaid and the Supplemental Nutrition Assistance Program (SNAP), according to a federal report. A new Government Accountability Office (GAO) report titled Federal Social Safety Net Programs: Millions of Workers, Including Many Employed by Large Employers, Continue to Rely on Medicaid and SNAP examined data across 11 states, revealing that safety net beneficiaries often hold jobs at prominent national employers rather than remaining outside the workforce.

The report, requested by Senator Bernie Sanders in his capacity as Ranking Member of the Senate Committee on Health, Education, Labor, and Pensions, serves as a follow-up to a similar 2020 study. Researchers focused on data from Arkansas, Georgia, Indiana, Maine, Massachusetts, Nebraska, North Carolina, Oklahoma, Rhode Island, Tennessee, and Washington to evaluate the employment status of safety net participants.

Findings from the GAO review indicate that working-age beneficiaries in both Medicaid and SNAP frequently maintain active employment, often on a full-time basis, and participate at rates exceeding working-age individuals not enrolled in the programs. The data highlights a significant presence of workers from large retail, grocery, and gig-economy sectors among program recipients.

Employment trends within these beneficiary populations show a distinct shift toward app-based food delivery and ride-sharing gig work, which saw substantial increases in SNAP participation. Meanwhile, large enterprises continued to register high counts of workers receiving government assistance. In the 11 states studied by the GAO, Walmart accounted for 16,000 workers on Medicaid and 15,500 workers on SNAP, while Amazon accounted for 11,000 workers on Medicaid and 12,000 workers on SNAP.

State-Level Scrutiny and Legislative Responses

Individual states have begun enacting fiscal policies targeted at large employers whose workers rely on public health insurance. New Jersey recently passed legislation requiring employers with at least 50 workers enrolled in Medicaid to pay an annual fee ranging from $345 to $725 per affected employee, a measure state projections estimate will generate $145 million annually. State estimates indicate that Amazon accounts for 5,600 workers and 10,000 dependents on New Jersey Medicaid, while Walmart accounts for more than 10,000 workers and family members combined.

Similar legislative proposals have been introduced in California, Colorado, and Washington. Alan Dubinsky, a spokesperson for the Service Employees International Union Local 49, stated in reference to corporate labor practices that major companies possessing substantial capital should ensure their workers have adequate health coverage.

Independent analyses of state administrative records have mirrored the GAO’s findings. A review conducted by the Oregon Capital Chronicle regarding Medicaid applications found that dozens of major national and multinational corporations paying low hourly or median wages rely on government health programs to cover healthcare costs for thousands of employees. That analysis identified Walmart, Safeway/Albertsons, Amazon (and affiliates), Fred Meyer/Kroger, and McDonald’s among the top employers listed on benefit applications.

Corporate Defense and Policy Debates

Defending the company’s employment practices, an Amazon spokesperson told The Washington Post that employee pay ranks among the best in the industry, that regular full-time employees receive access to healthcare coverage from their first day of employment, and that 74% of regular full-time workers are enrolled in an Amazon health insurance plan, exceeding the estimated 65% private sector take-up rate for full-time employees.

Senator Sanders criticized corporate reliance on public assistance programs, arguing that profitable enterprises should pay wages that eliminate the need for federal subsidies.

The release of the GAO report arrives amid ongoing legislative debates over federal work requirements for safety net programs. Proponents of work requirements have contended that mandates encourage labor force participation among able-bodied adults. Conversely, critics point to administrative costs, coverage losses, and data showing that the vast majority of adult beneficiaries already work or face significant barriers to employment.