Gig workers have access to more affordable health plans but may not be aware of it

There is an affordability perception gap among gig workers, a new study finds, with many workers thinking they cannot afford health insurance even though low-cost plans are available through the Affordable Care Act marketplaces.

The survey by Stride Health, an online benefits platform, finds that 24% of gig workers say they currently lack health insurance, of those workers, 58% say that they did not have health insurance because it is unaffordable.

However, with the passage of the Inflation Reduction Act (IRA), subsidies for ACA plans have been extended through 2025, making plans much more affordable for gig workers. The health care subsidies were originally part of the federal response to the COVID-19 pandemic and were extended with the passage of the IRA.

“Last year’s increase in ACA premium tax credits, which were recently extended through 2025, have increased care access by driving down health insurance prices for millions of independent and gig workers,” says Noah Lang, CEO and co-founder of Stride Health. “But there is a massive education gap around affordability among non-benefited worker populations where nearly 6 in 10 uninsured workers think coverage is unaffordable and unattainable. However, with roughly half of those insured in that workforce paying $0 for that coverage, it’s critical for every independent worker to evaluate their eligibility for tax credits, compare or change plans, and get covered for 2023 — and that’s exactly what we built Stride to do for them.”

A big gap in perceptions about affordability

The study suggests that many workers simply aren’t aware of the lower costs of some ACA plans. It finds that 80% of respondents say that they think health insurance costs more than $100 per family member, but of those who were insured, 72% of workers spent less than $100 per family member.

More specifically, the report finds that 45% of insured gig workers report paying $0 on premiums thanks to ACA tax credits. Another 27% report paying between $1 to $100 per family member for health insurance.

Race plays a role; for example, Hispanic/Latino workers are currently uninsured at a rate 40% higher than Caucasian workers, the study finds. And 31% of gig workers that identify as Hispanic or Latino report currently not having health insurance, compared to 24% of gig workers that identify as Black or African American, and 22% of gig workers that identify as white or Caucasian.

It may be that the word is simply getting out slowly — the survey finds that between 2020 and 2022, more workers say they would re-enroll or shop for a plan during an upcoming enrollment period.

In 2020, 64% of gig workers said they would re-enroll in a new plan or keep their current health care coverage. Fewer than 30% said that they were “undecided” about enrolling for health care coverage or said they plan to go uninsured.

In 2022, the study finds, that number jumped to 88% of gig workers who say they would re-enroll in a new plan or keep their current health care coverage. Only 12% of gig workers in 2022 say that they plan to go uninsured in 2023.

Gig workers find their jobs rewarding but challenging

The survey finds that nearly 90% of respondents say they are happy with the work they do; including 81% who say they enjoyed the freedom and flexibility of working independently, and 71% who say it allows them to spend more time with their families and loved ones.

Related: Study finds similar financial worries among both gig workers and corporate employees

They also feel optimistic about future earnings as gig workers; 89% say their earnings will stay the same or increase in the next year. However, they also report concerns, which include access to affordable health care (30%), unpredictable income (66%), putting money into savings (45%), and managing taxes (34%).