Staggering 84% of NYC's One Million-Plus Independent Workers Have Difficulty Affording Private Health Insurance, Says Working Today Survey Results

Brooklyn, NY - May 25, 2004 - Freelancers and independent workers are a thriving, prosperous and increasingly important segment of New York City's economy and workforce, but the vast majority of them cannot afford soaring health insurance costs, according to the results of a survey released today by Working Today, the non-profit group focused on the independent workforce.

The 2004 Working Today Health Insurance Affordability Survey gauged the perceptions of more than 4,000 New York City-based freelancers, independent contractors, temps, sole proprietors and others who make their living in a range of industries, such as media, entertainment, financial services, marketing, IT and the arts.

Freelancers Burdened by New "Middle-Class Squeeze"

Said Sara Horowitz, Executive Director of Working Today: "New York's growing and dynamic freelance workforce is predominately younger, educated and well paid. And yet when it comes to health insurance, hundreds of thousands of them are losing sleep, avoiding basic health care, or risking bankruptcy to secure coverage in the private market. Today's freelancer is the poster child for the new 'middle-class squeeze.'"

Among the survey's key findings:

• 84% of NYC's freelancers say it's difficult for them to afford health insurance.
• Nearly all (95%) of NYC freelancers without health insurance say the primary reason they lack it is because premiums of private carriers are too expensive.
• Nearly half (47%) of NYC freelancers say they had gaps in health insurance coverage, or no coverage at all, during the past two years - and the vast majority (88%) blame high costs.
• 85% of those who experienced gaps avoided medical care during these times.

In its survey report, Working Today estimates that a New York City-based freelancer needs to earn $120,000 a year to afford the average monthly HMO premiums in the individual market. Yet, less than 4% of freelancers surveyed report an income above $110,000.

Freelancers Bear Brunt of Being "Outside the System"

There are upwards of one-and-a-half million independent workers in New York City, and tens of millions around the country (up to 30% of the nation's workforce), according to published reports.

"The rapid growth of the Form-1099 labor pool represents a fundamental shift in the economy, yet the health insurance system remains geared solely to the W-2 employment model," said Ms. Horowitz.

Added Ms. Horowitz: "Most freelancers are too rich for public assistance programs, and too poor to afford the premiums demanded on the open market. It's really appalling that millions of productive members of our society are falling through the cracks in an area as basic as health care."

Freelancers: A Thriving But Overlooked Segment of Middle Class

The Working Today survey results show that New York City's freelancers tend to be solidly middle class; in fact, their median income is estimated to be nearly the same as that of average New Yorkers. Freelancers also tend to be very highly educated, young-to-middle aged, single and presumably healthy. Interestingly, they also appear to have chosen to work independently, as opposed to having been forced by circumstances.

• NYC freelancers are a thriving segment of the middle class: 42% report annual incomes of $25,000 to $50,000, while 32% say their income is more than $50,000.
• NYC freelancers are one of the most highly educated segments of the workforce: Nearly 90% have a college degree or a graduate degree.
• NYC freelancers are mostly young or middle-aged. More than 50% are between 25 and 40 years of age, and 58% are single.
• Most NYC freelancers appear committed to an independent work style. Nearly 75% say that in the last two years they did not switch back and forth between freelance and full-time employer-based work.

"We often don't realize how ubiquitous and economically vital the independent workforce is to New York City," said Ms. Horowitz. "It's the person who wrote the article you read in the morning paper, who does your taxes, fixes your computer. They're an astoundingly diverse group that tends to be self-motivated and passionate about their work. The problem is this diversity and independence impedes their ability to harness their power as a group."

Working Today Brings Freelancers Together, Offers Affordable Coverage

Working Today was founded in 1995 by Sara Horowitz, a MacArthur "Genius" Award recipient, as a 501(c)(3) non-profit organization to address the needs of America's growing independent workforce through advocacy, information and service.

Most prominently, Working Today's Freelancers Union has emerged as a key conduit and group-rate sponsor of affordable health, life and disability insurance for several thousand New York City-based freelancers and independent workers. For example, qualifying NYC freelancers can get HMO health coverage for about $280 per month through Freelancers Union, compared with the average, open-market HMO premium of $521 per month.

Concluded Ms. Horowitz: "Many of this year's survey results reinforce both the importance of the freelancer labor force, and the glaring lack of attention to its most basic needs. We hope our findings serve as both a wake-up call to policymakers and a jumping-off point for exploring how the health insurance system can be improved and incentivized to factor in America's growing, independent and mobile workforce."

To view a full copy of the Working Today survey results, or to view a geographic breakdown of freelancers in the City of New York by zip code, or to read select case studies on the plight of freelancers and health insurance, please see the Affordability Report 2004 .