As companies turn to part-time and gig work, finding health coverage is major issue for many remote workers. Contractors, freelancers, gig workers, and part-times are not usually eligible for benefits at this time. However, obtaining health insurance for remote workers may be more affordable than they thought.
Part-timers and remote workers who consider themselves freelancers, independent contractors, or gig workers who love the flexibility of their jobs may lack what full-time employees take for granted: health insurance. While health care is available to anyone who can pay for it (or have it paid for if they qualify for programs that cater to low-income individuals), having insurance makes the care more affordable.
The Health Insurance Dilemma For Freelancers
Many who work remotely find themselves with no health insurance and no paid time off. Lack of insurance means workers feel compelled to work while sick to keep their income on track. During COVID, this meant that some who contracted the disease had to cover the costs of medical consultations, prescriptions, and even hospitalizations on their own.
In the U.S., health insurance is often tied to employment and has been since World War II. While individuals can purchase health insurance on their own, it is costly and often not as comprehensive as what people get as an employee benefit.
A study by a UK financial firm, the Legal & General Group, found that:
- 23% of gig workers lack health insurance
- 69% of workers who are parents have it
- 42% of gig workers say that access to healthcare, life insurance, and pensions would encourage them to take a traditional job
These findings were backed up by a study from Stride Health that found 24% of gig workers without insurance, with 58% of respondents saying they did not have health insurance because it was unaffordable. The percentage of workers without insurance is higher among black (24%) and Hispanic (31%) workers than for whites (22%).
Having health insurance increases worker security and removes some of the stress of being ill or injured.
Employer Reliance On Part-Timers-And Contactors Decrease The Insured
The lack of health insurance for remote workers may seem like a problem for workers alone as many companies have found that the advantage of hiring non-employees is freedom from paying benefits. When the pandemic hit, and many workforces became temporarily remote, some companies assessed their workforce and looked for cheaper options. This involved hiring people they did not have to provide with health insurance.
According to a study by the Atlanta Fed, employers turn to part-timers (23.3%), independent contractors (18.4%), outsourcing firms (14.7%), temps (13.3%), and offshore workers (7.3%) to get their work done. Even those who were skeptical that workers not under their direct control would get the work done found worker productivity high enough to make them more comfortable with remote work.
They felt distant from their full-time employees and found themselves shifting attitudes toward hiring independent workers. The ability to cut labor costs helped companies make it through hard times and be flexible in their hiring, especially for short-term projects. If someone lost time or quit due to illness, they could always find replacements. However, continuity in the workforce is still valuable. And worker health is tied to productivity.
Moving toward gig work does not just benefit businesses. As companies enjoy the ability to be agile and scalable in their hiring, many workers are seeking positions that are flexible. Some work “gigs” as side jobs, while others piece together a series of gigs to make a living. Gig work can benefit employers and workers. Some experts predict that employers may ultimately lead to companies offering benefits to remote workers to attract the best people.
In the past, some politicians have lobbied for more portable insurance plans not tied to employment, but these ideas have not broken the link with employer plans.
Insurance Help Through The ACA Offers Health Insurance For Remote Workers
The Affordable Care Act of 2009 set up healthcare exchanges to make insurance more accessible and affordable for all Americans, while not disrupting the insurance industry, Those who qualify for employer plans can keep them, but insured families had more opportunities to obtain coverage. Many workers qualify for subsidies good through 2025, as well as tax credits.
The takeaway is that health insurance may be more affordable than workers think. Stride Health cofounder and CEO Noah Lang notes while 6 of 10 workers think coverage is too expensive, the cost may come out to less than $100 per family member per month. The Stride study documents that 45% of gig workers pay nothing due to the ACA credits, while 27% pay $1 – $100.
Within ACA exchange plans, there are tiers of coverage to choose from that have variable premiums in line with cost-sharing requirements like deductibles, copays, and coinsurance. The plans must offer certain coverages, while other coverages for vision, dental, disability, critical illness, accidents, etc. are excluded.
The percentage of what the plans will pay on average is called an actuarial value.
- Bronze health plans – 60%
- Silver health plans – 70%. (But if you’re eligible for subsidies or cost-sharing reductions—CSR—the actuarial value of a Silver plan might be much higher than 70% through 2025)
- Gold health plans – 80%
- Platinum health plans – 90%
Uninsured gig workers might find health insurance more attainable than expected, but selecting the right plan can be complicated. Fortunately, the healthcare.gov site offers help online and through local agents who direct them to the best alternative.
Those not used to paying for health insurance out of pocket may regard health insurance premiums as another bill demanding a share of their variable income. This problem might be especially real for low-income workers living paycheck to paycheck.
Those who examine their health care options might find they can get peace of mind for a small monthly investment.
