Health Insurance Covering Preventive and Wellness Care for Independent Workers

“One of the big differences between Freelancers Insurance Company and other insurance models is that we have a two-generation timeline: we’re investing in wellness.”—Sara Horowitz, Executive Director, Freelancers Union

Dates of Project: December 2008 to June 2010, and November 2010 to November 2012

Field of Work: Providing affordable, high-quality health insurance to independent workers and other freelancers

Problem Synopsis: Independent workers account for some 30 percent of the nation’s workforce. Many earn too much to qualify for government-funded health insurance and too little to afford private insurance. Many also want more preventive and wellness care than most insurers cover.

The Affordable Care Act authorized federal loans to new nonprofit consumer operated and oriented health plans (CO-OPs) that provide coverage to individuals and small groups. The CO-OPs will compete with for-profit companies on state health insurance exchanges.

Synopsis of the Work: In 2008, Freelancers Union, a national New York–based nonprofit, launched Freelancers Insurance Company (FIC) to provide affordable health insurance to low- and moderate-income independent workers.

In 2011, Freelancers Union tapped that experience to begin building nonprofit health insurance CO-OPs in several states.

Key Results

  • Freelancers Insurance Company offered five health insurance plans to members of Freelancers Union in New York State, beginning in January 2009. All five plans covered a range of preventive and wellness health benefits at little or no cost to members. Some 45 percent of subscribers earned less than 80 percent of area median income, and insurance premiums averaged 5 to 8 percent of their income.
  • Freelancers Insurance lost $6.6 million the first year but posted a $2 million profit the second year, as it gained experience in the health insurance market. The company did so while raising premiums 11 percent the second year—while other insurers were raising premiums for independent workers by 30 percent to 40 percent.
  •  In 2012, Freelancers Union received $340 million in low-interest and no-interest federal loans to launch CO-OPs in Oregon, New Jersey, and New York. After the project ended, regulators in those states licensed the CO-OPs as health insurers in 2013. They will begin offering coverage in January 2014.

“We want to build solidarity and connection... We want to provide care that is driven by what people need.”—Sara Horowitz, Executive Director, Freelancers Union

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Freelancers Union under ACA will launch CO-OP health insurance plans in Oregon, New Jersey, and New York

“This is about truly integrating care that enables people to be full human beings.”—Sara Horowitz, Executive Director, Freelancers Union