Gig workers in the past have had to face either not being covered by health insurance at all or being underinsured due to not working in a traditional employment setting. Companies, and other new initiatives, are working to put an end to the gap of gig workers as "underinsured."
A study done by Stride of 3,000 independent workers showed that 31% lacked health insurance. Of those who are underinsured, 64% said affordability was the primary concern and 78% were unaware that 4 of 5 Americans are now eligible for the Affordable Care Act due to the 2021 changes.
“The American Rescue Plan has made health insurance far more affordable for far more Americans but, clearly, gig workers still don’t know it,” Noah Lang, co-founder and CEO of Stride said, according to AP News.
According to the press release from Stride in August, data released from the company showed that nearly 40% of gig workers who had enrolled in health insurance in 2021 were paying less than $1 a month for coverage and 7 of 10 had better plans at half the cost.
"Over half of the U.S. population has coverage under group health insurance, either through their own employer or a family member. Unfortunately, this option is not available for gig workers," Forbes reported. "They have options, like getting on a spouse’s plan or taking advantage of COBRA, if they’ve recently made the switch from full-time employment."
The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows for a worker who recently ended a full-time job to continue health insurance for a period of time under certain circumstances, according to the Department of Labor. For most gig workers, the easiest option was to get private insurance, which before changes to the American Rescue Place in 2021, was very expensive for independent workers.
Changes made by the American Rescue Plan to the Affordable Care Act “provide economic relief to middle-class Americans in the context of rising healthcare costs,” said Dr. Alice Chen, chief medical officer at Covered California.
According to Forbes, gig worker drivers "require health care plans with decent coverage for injuries, orthopedic surgeries, rehabilitation". It also reported that "60% of one benefits platform’s ride-hailing and delivery drivers opted for higher-tier marketplace healthcare plans (higher-cost, more coverage). Ironically, the cost of coverage for such drivers has been reduced by more than 50% since March 2020."
EBN claims that the individual coverage health reimbursement arrangement (ICHRA), which allows employers to provide tax-free reimbursements for insurance premiums and medical expenses, may be the future for gig work insurance. An ICHRA can allow for an employee to go into the Affordable Care Act exchange, choose a health plan and the employer put up a certain amount per month to help pay the premium of that plan. Some issue with this, according to EBN, is this would not work for those living paycheck-to-paycheck or for those employees who pick plans not supported by an employer.