Self-Employed, Freelancers, Contract Workers Struggle to Find Health Care

NEW YORK - There are plenty of problems lurking on America’s career ladder, but here is a big one: our healthcare systems are designed for the workforce of 1950. 

If you have a lifetime corporate 9-to-5 gig, then you probably have group health insurance. 

But what if that is not the kind of job you have? Well, good luck with that. 

More Americans than ever are falling into that second category, a scrappy mix of the self-employed, solo entrepreneurs, freelancers and contract workers. More than 57 million Americans, or 36 percent of the workforce, freelance, according to a recent study by the Freelancers Union. 

Among millennials, that number rises to 47 percent. By 2027, if trends continue, the majority of the workforce is expected to be freelance. 

Such a scenario will require new initiatives. 

Stride Health, a kind of coverage matchmaker, has teamed up with companies whose employees are primarily independent – like Care.com, Etsy, Fiverr, DoorDash and Postmates – to funnel freelancers into the healthcare policies and plans that are right for them. 

So far the coordinated push has been encouraging: With Postmates, about 30 percent of workers had Stride’s help navigating Obamacare exchanges, and 1,300 of them who did not have it previously secured coverage. 

At Care.com, 85 percent of caregivers working with Stride received a subsidy for health coverage, at an average of $460.54 monthly. 

“Like most gig workers, caregivers frequently work for more than one employer with no access to the benefits that those working for traditional employers take for granted,” said Bryan O’Malley, general manager at Care.com. “With more of a social safety net, we are helping provide critical benefits so caregivers can look after themselves and their own families.” 

At the best of times, healthcare is a tricky thing to figure out. For independent workers, doubly so: Not only does their income fluctuate month-by-month, but the policies and premiums available to them are constantly in motion as well. 

“If you are a freelancer facing the pure retail cost of healthcare, then it is horrifying,” says Kathy Hempstead, senior advisor for the Princeton, N.J.-based Robert Wood Johnson Foundation, the nation’s largest philanthropic organization devoted solely to healthcare. 

That is why the Affordable Care Act was a “total game-changer” for independent workers, Hempstead said. A system of subsidies helped pull millions into coverage, and plans compliant with the ACA offer a guarantee of a certain level of quality, such as coverage for pre-existing conditions. 

STATE SOLUTIONS 

Despite the current administration’s attempt to scrap it, the ACA still stands – for now. 

Many states are also coming up with solutions on their own. 

Minnesota and Alaska, for example, have received waivers to devise plans in which they contribute additional cash to help keep costs low for policyholders. 

In those states, premiums have actually been falling, says Karen Pollitz, a senior fellow at the Kaiser Family Foundation. Alaska, for instance, actually had a 26.5 percent decrease in rates on its independent market for 2018. 

California, New Jersey and Florida have also taken steps to protect their risk pools and make sure premiums do not soar, says Hempstead. Others, like Iowa, are on the other end of the spectrum, having real trouble providing affordable insurance to independent workers. 

There are plenty of other changes bubbling on the healthcare front. One potential development: So-called “association” plans, in the works from the Trump administration. 

Those could be good for some independent workers, and bad for others. A yoga-teachers’ health plan, for instance, would presumably provide good coverage at affordable rates, since the participants are fit and health-conscious. But draw those healthy people out of other plans, and everyone else’s premiums will go up. 

There is an upside to such a massive problem, in that it represents a tantalizing potential market. With so many millions of gig workers in need of healthcare, there are rich opportunities for innovators able to figure out this particular puzzle. 

Perhaps the biggest question mark of all: The recent joint announcement of Amazon, Warren Buffett’s Berkshire Hathaway and JP Morgan Chase, which are teaming up to form an independent healthcare company billed as “free from profit-making incentives and constraints.” 

If that partnership offers policies to independent workers, beyond just the employees of the three companies, all bets are off. The healthcare world could be turned on its head.