New Models for Health Insurance


Credit: G. Grullón/Science

The future begins in California, the old saying goes. If so, postdocs across the country may be witnessing the dawn of a new era of health insurance opportunities. The University of California's (UC's) new postdoc health plan, announced 1 July and reported last month in Next Wave, represents an innovative model for providing coverage to all postdocs, regardless of the source of their funding or their status as employees or nonemployees. When the plan goes into effect on 1 January, it will make every postdoc in the vast, 10-campus system eligible for uniform health coverage. It also suggests possibilities that might work on other campuses.

In designing its plan, UC departed from traditional approaches to postdoc fringe benefits in some fundamental ways. First, the plan uncouples health insurance eligibility from employment status, enrolling all postdocs regardless of how the universities or funding agencies classify them. Second, it transcends any single campus and encompasses postdocs throughout the enormous system. Finally, although the plan will offer uniform benefits to enrollees across the system, it may do so using different companies in different parts of the state.

Detaching health insurance from employment status may surprise Americans who assume that the two necessarily go together. But this country's customary link between insurance and employment is nothing more than historical accident. The first Americans to get health insurance, in the 19th century, bought it individually from insurance companies, often as part of life insurance or other coverage. In the early decades of the 20th century, some trade unions began providing their members group health coverage. Employer-based group health insurance, however, first gained national attention during and after World War II. Wartime wage restrictions prevented employers from attracting scarce workers by raising wages. But because fringe benefits--not yet important on the American job scene--were unregulated, unions started seeking insurance and other benefits in lieu of pay hikes and some employers began offering them as hiring inducements. By the early 1950s, health insurance was an increasingly common part of the total employment package offered by large organizations. Before long it became routine.

But entities other than employers can contract for group health insurance. In fact, any group of people can try to persuade an insurance company to cover them. UC, for example, is seeking bids from insurers to cover its postdocs in the expectation that underwriters will find 5200 educated people in their 20s, 30s, and early 40s quite an attractive risk. Unlike the general UC employee pool, the postdoc pool lacks "all those people in their 50s and 60s where things are going wrong," says Jean Fort, assistant vice chancellor for research at UC San Diego and chair of the committee that developed UC's new policies toward its postdocs.

Other multicampus university systems seeking to insure all their postdocs might profitably emulate the UC model, which might also work for consortia of universities in cities or regions with multiple research institutions. As at UC, putting such a plan together would take leadership, vision, and a great deal of work. UC administrators, for example, spent 6 years working out the details of their new postdoc policy.

But if universities fail to take the lead in providing health insurance to all postdocs, nothing prevents postdocs themselves seizing the initiative. By doing so, they'd be following the example of people in a number of occupations who have banded together to form their own health insurance groups. Twenty-eight years ago, for example, a half dozen self-employed professional writers in Washington, D.C., decided to round up enough fellow freelance scribes to start an organization that could buy group health insurance. Today the association they founded, Washington Independent Writers (WIW), has more than 1500 members, some 200 of whom subscribe to an association health insurance plan covering the District of Columbia and five surrounding states. The Entertainment Industry Group Insurance Trust (TEIGIT), headquartered in New York City, is another of such entities that provides insurance for workers who have no regular employer; the plans it administers cover professionals in show business and the arts. Physicians throughout the South get health and other insurance through the Southern Medical Association. The American Institute of Architects offers a health plan available in most states.

Running an association-based health insurance plan is "challenging but possible," says Aishling McGinty, WIW's former membership coordinator. Finding and keeping insurers willing to cover membership association is becoming increasingly tricky in today's ever more problematic health insurance marketplace, however, and many companies now shy away from selling nationwide coverage. TEIGIT's insurance, for example, is only available in New York, New Jersey, California, the Chicago and Atlanta areas, and South Florida.

Following the lead of these and other organizations, the National Postdoctoral Association (NPA) might also serve as a catalyst for postdoc health insurance. At present NPA is "really just starting" and is "forming collaborations with institutional postdoc associations and investigating their needs," says Carol Manahan, chair of the executive board. But it actively "encourage[s] the formation of local associations" that transcend single institutions and already "a couple of alliances are forming" in such postdoc-rich locales as New York City and the North Carolina research triangle. Seeking ways to involve these groups and alliances in providing association-based health coverage "would be a great idea if institutions aren't responsive," she noted.

It's too early to know which of these various models could work for postdocs outside the UC system. But the experience both at UC and numerous trade and professional organizations strongly argue that it's worth finding out. Unlike doctors and architects, who range over the entire age spectrum, postdocs are overwhelmingly in the healthy prime of their lives. Unlike writers, actors, and musicians known for "wild and crazy" lifestyles unattractive to insurers, scientists have a reputation for probity and clean living--just the kind of people insurance companies love to enroll. Alternatives to employment-based health insurance certainly appear feasible for postdocs. What remains is doing the experiment, and finding out empirically whether they will work.

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