Can Healthcare Reform Make or Break the Gig Economy?
There is a very real possibility that the Affordable Care Act (ACA)—or significant portions of it—will be repealed. This raises many questions that affect workers’ employment decisions, overall health and well-being, and financial status.
Will changes in ACA healthcare make or break the gig economy? Will more workers choose healthcare over job satisfaction? Will small business owners’ profits be swallowed up by high premiums of high-risk pools? Will startups be able to attract top talent if they can’t offer an affordable healthcare option? How do large businesses fill the talent voids currently filled by independent workers?
The most intriguing question of all for the New World of Work is something we may never be able to quantify: Will the dreamers and innovators and entrepreneurs of this brave new world abandon their passions? And if they do, what will become of our most promising new industries and technologic advancements?
The ACA & the Gig Economy.
The ACA expanded health insurance to roughly 20 million Americans, including those with pre-existing health conditions. Of those currently receiving health insurance coverage under the law, one in five is self-employed, a small business owner or both, according to a 2014 report issued by the U.S Department of Treasury. This translates to approximately 4 million people who represent segments of the gig economy who rely on this insurance, as well as businesses that rely on these workers to fill talent gaps.
The ACA enabled more self-employed, temporary workers and independent contractors to obtain health insurance independently. With the ACA, small businesses and new startup organizations with fewer than 50 employees had an option to offer affordable healthcare even when it was not legally required. They had opportunities to expand their talent base by including temporary and independent workers who wanted to make a difference in a smaller organization and contribute to the expansion of a small business.
In addition, small business owners (those with 50 to 90 employees) who were required to provide health insurance to their employees were able to use the ACA as a lower-cost provider of insurance that did not discriminate for employees with a pre-existing condition. The availability of the ACA healthcare option contributed to the popularity of the gig economy.
Many people are proud to be part of the gig economy. They contribute real value not only to the organizations where they work but to our society. These entrepreneurs, new startup business owners and other independent workers are empowered by their freedom to learn, innovate and follow their passions.
Without access to affordable healthcare, the potential impact on the gig economy may seem obvious: More people will decide to choose traditional, salaried jobs over contract and freelance work. Yet, it’s the indirect impact that is even more likely to make or break the gig economy.
In the New World of Work, creativity and innovation offer critical advantages to businesses both large and small. When people feel uncertain, confused or stressed, they start to lose their confidence and drive. The power of creativity and innovation is diminished, not only in the individual but throughout the organization.
Health insurance can take care of workers when they are sick. But what fuels their wellness? The ability to create and contribute keeps minds and bodies healthy, and the entrepreneurial spirit alive, even in times of uncertainty.