July 14 (Bloomberg) -- Target Corp. and Kelly Services Inc. said they may support Wal-Mart Stores Inc.’s call for mandatory medical insurance by large companies as part of a proposed overhaul of U.S. health care.

“Conceptually, we can accept an employer mandate,” said Kay Rubbelke, a spokeswoman for Minneapolis-based Target, the country’s second-biggest discount retailer after Wal-Mart.

Kelly Services, the Troy, Michigan-based provider of temporary workers, could support a mandate that has effective cost-containment provisions, said Jim McIntire, vice president of public affairs.

The positions of the two companies signal a widening split in the business community over the issue, a core element of President Barack Obama’s proposed changes. Yesterday, the National Retail Federation, the industry’s largest trade group, told members to “come out swinging” against Wal-Mart’s call for federally mandated company health insurance.

Whole Foods Market Inc. and Wegmans Food Markets Inc. are among the companies that say they oppose mandatory employer insurance. United Parcel Service Inc. says it would oppose employer mandates if they increased costs.

Labor unions and allies of Democrats crafting an overhaul of the nation’s health system insist an employer mandate is essential to making health coverage broader and more affordable.

‘More Important’

“It’s more important for folks to have jobs,” Paul Speranza, vice chairman and general counsel for Rochester, New York-based Wegmans, a closely held supermarket chain. An employer mandate could be “extraordinarily costly to business,” he said.

Whole Foods spokeswoman Kate Lowery said in an e-mailed statement that the company “is not in favor of employer health insurance mandates, and we hope that Congress and the administration will consider very carefully both the costs and impacts of any proposal that might impose such a mandate.”

“Employer mandates and costly changes to the taxation of employer-provided health care will have a negative impact on employer-sponsored coverage,” said Malcolm Berkley, a spokesman for UPS.

Target and Kelly said their support of an employer mandate would depend on the conditions attached. “We will not support any proposal without seeing final language,” Rubbelke said.

Kelly is breaking ranks with other companies because of a commitment by Chief Executive Officer Carl Camden to health-care changes, McIntire said. A health-care system that covers more uninsured also would cause more individuals to consider the part-time employment services Kelly provides, he said.

To contact the reporter on this story: Holly Rosenkrantz in Washington at hrosenkrantz@bloomberg.netHeidi Przybyla in Washington at hprzybyla@bloomberg.net

Last Updated: July 15, 2009 12:48 EDT