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eBay To Offer Health Insurance
Logic Bomb writes "EBay has announced it will be offering group health coverage for "full time eBay merchants". Anyone who grosses over $1000/month in sales -- at least a whopping 80,000 users in good standing -- will be eligible to buy into a typical "employee" health plan. This is a big first in the Internet world. Full details from the LA Times." And the LA Times, trying to cop a pose from the NY Times, reqs a login.
Houston Chronicle has the story available with no register.
Self-employed purchase of health insurance is very expensive. Maybe you live in the middle of nowhere and the rates are cheap, or maybe you're smoking some really good crack ;), but in the NYC metro area, if you're self-employed it costs a small fortune to buy health insurance from anyone. HMOs and others charge much higher fees to self-employed individuals than to corporations (per person). That's one reason why there's a larger federal tax break for money spent on health insurance when you're self-employed (there's an additional Schedule (E?) that you have to fill out if you don't work for someone else's corporation). So I'm sure the "bulk" insurance that E-Bay is selling is cheaper per person than buying it alone. E-Bay's insentive may partly be for the tax benefits.
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Why bother...
Read about it on CNET without the hassle.
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To all those wondering how auction sellers qualify as employees -- a quick "find text" in the article doesn't turn up any form of the word "employ".
This is simply a group policy, like those you can get thru the National Association of the Self-Employed, or dozens of other small-business and "group" organizations.
All you need for group discounts is a large group -- they don't have to be co-workers. E-Bay isn't contributing to the funds.
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Whose going to manage these benefits? Will eBay have a new department for assisting their people with benefit claims?
What an insurer needs in order to spread risk is a large pool of people selected for some criteria not related to their health/propensity to make claims. The healthy group members pay and don't claim, while the unhealthy members claim a lot more than they pay, and the system works. Traditionally, such groups have been {all employees of a given company}. EBay is a good candidate for a new type of group. What will not work is any internet community that is self-selecting on the basis of wanting health insurance. Such groups will contain too high a percentage of unhealthy people.
EBay will be pretty limited as a precedent, I think. EBay's members have to really commit to EBay (be high volume sellers) to get covered. It's not as easy as saying, "I think I'll switch ISPs to Earthlink because I like the health plan."
On another note, it's not trivial to offer health insurance to a national group. Most health insurers have regional networks of physicians and services. (This is partly because insurance is licensed on a state by state basis.) Some few have enough regional networks to be effectively national, but you can bet that people outside population centers are going to find they have somewhat limited choices when it comes to selecting physicians near them. EBay sellers have got to be just about the most geographically diverse insurance group ever attempted. Many, many employers have one or a few locations, e.g. a plant. EBay users don't have any locations/concentrations other than the fact that more of them will be found in cities because that's where the people are.
Still and all, more power to 'em, I say.
"We reject as false the choice between our safety and our ideals." --The American President (20.1.2009)
FYI: for those in NYC & NY state, there is a program that offers very inexpensive access to the HMO's. I'm not a hundred percent sure of how much the government is picking up, but it's called Healthy NY.
/month, and covers most of the necessary things in medicine. It is offered by *all* HMO's that operate in New York State. Same coverage, different administation, and networks, yields the price difference.
It is available for uninsured working individuals, sole proprietors, and small buisness owners. They each have their own rules. However, the prices are in the 180-220