Travel nursing medical benefits may seem quite simple on the surface, but the issues at play are extremely complex. Ultimately, travel nurses need to decide whether or not they want to secure their own medical benefits or take travel nursing company provided benefits. Each option has advantages and disadvantages.
When making this decision, it helps to know a little something about how healthcare coverage works in the US, and be to be familiar with some applicable laws. I say this because unlike virtually every job that provides medical benefits, your travel nursing job is temporary. It’s pretty rare for temporary jobs to offer medical coverage. And while you may be convinced that you’ve found the agency that you’re going to work with forever, chances are very strong that you’ll be bouncing around from agency to agency over the course of your time as a travel nurse.
Medical benefits and switching travel nursing companies
The first thing to understand is that if and when you switch agencies, your health insurance provider will most likely change which may interfere with your continuity of care because different agencies use different insurers. In other words, you may have to change doctors because no insurance company works with every doctor and vice versa.
Additionally, there is no one insurance plan that covers every medication on the market, so you may also have to change prescription drugs. This is especially true if you’re using a name brand drug. Prior to signing on with a new agency, you can request their medical plan’s formulary, which is a list of covered medications, from the agency or directly from the insurer’s web site to find out if the prescriptions you’re taking are covered. Furthermore, insurance plans have deductibles that don’t get carried over from one plan to the next. So you may get stuck paying a deductible several times over if you change insurance plans several times in a year.
Maintaining medical benefits with COBRA as a travel nurse
In my opinion, these items, along with pre-existing conditions which we’ll discuss shortly, are the biggest concerns that you should be worried about when it comes to deciding whether take company provided medical benefits or secure your own. However, most travelers are most concerned about being without coverage for even a single day when they are leaving or changing jobs. In my opinion, this is the least of your concerns as there are options available. For example, in the vast majority of cases, you are guaranteed the option of purchasing health insurance when you leave a job or are terminated from a job that provided you with health insurance. This guarantee is the result of what is commonly referred to as COBRA.
COBRA is a federal law that offers former employees and their dependents the right to temporary continuation of health coverage at group rates. In the vast majority of cases, when you voluntarily or involuntarily leave a job and your benefits are terminated, you are eligible for COBRA coverage. Essentially, you are being offered the opportunity to purchase the same exact health plan you had at your old job at the group rate (the rate the company was paying). You can continue the coverage for 18 months and may qualify for extensions under certain circumstances.
When a qualifying event occurs (you quit or are terminated from your job), you’ll have ample time to secure your COBRA coverage and you are assured uninterrupted coverage once it is secured. First, the employer must notify the plan administrator within 30 days of the qualifying event. Then, the administrator has 14 days to send you an election notice. You then have 60 days to make your decision and get the paperwork back to the administrator. You then have 45 days after electing coverage to pay the initial premium. As long as you elect coverage and make the premium payment on time you’re covered for the whole timeframe.
The number one complaint I heard about COBRA was that it’s expensive. Yes, it’s expensive, but all health insurance is expensive and you’ll most likely get a far better deal with COBRA than you would if went out and tried to secure the same exact coverage on your own. This is because there is a very good chance that your employer received a price cut for purchasing a large volume of insurance for all of their employees. And because COBRA mandates that you can’t be charged more than 2% above the cost that the employer was paying, you’ll receive virtually the same price as the employer. You’ll certainly be able to find less expensive coverage if you shop around, but it will almost certainly not be as comprehensive.
However, if you do choose to purchase coverage on your own (not COBRA) and are concerned about denial of coverage due to pre-existing conditions, then you may find assistance in the recently enacted Affordable Care Act (commonly referred to as “ObamaCare”). Beginning in 2014, the Affordable Care Act makes it illegal for health insurance companies to deny coverage based on pre-existing conditions. In the mean time The Pre-Existing Condition Insurance Plan makes health coverage available to you if you have been denied health insurance due to a pre-existing condition and have been uninsured for at least 6 months. Details vary from state to state, but you can find out more at healthcare.gov.
Considerations for taking travel nursing agency medical benefits
Despite all of these issues and protections, you may sill prefer to take company provided health insurance. If you choose to take company provided benefits, you’ll need to find out everything you can about the coverage being offered. You’ll also need to determine how the agency handles healthcare coverage costs.
Different agencies offer different types of health coverage. My experience indicates that a few agencies offer high level coverage that is very comprehensive, a large number of agencies offer mid level coverage that may have higher deductibles and co-pays, a few offer lower level coverage, and some offer no coverage at all. It’s typically smaller companies that offer no insurance. And with the onset of the Affordable Care Act, smaller companies may be the only ones who are able to avoid providing benefits due to the laws requirement that all employer with more than 50 full time employees must provide health insurance or pay a penalty.
With the wide range of possibilities, you’re going to want to know exactly what you’re paying for. To get the information, you should request that the company provide you with the “Schedule of Benefits”, as it is typically referred to. The schedule of benefits will tell you among other things what the co-pays are, what the annual maximums are for hospital stays, what the monthly maximum for prescription drugs is, and how much the insurance will reimburse for ambulance services. I recommend obtaining the same information from your current health insurance plan to compare the plans your agencies are offering with the plan you currently have. This will give you a reference point.
The other main aspect of company provided health benefits that you will want to determine is how the agency handles the cost of the benefits. Again, contrary to agency sales gimmicks, nothing is free. And because the bill rate is most often the single source of revenue for the company, everything, including the cost of benefits comes out of the rate. Agencies have many ways of handling this.
First, some agencies factor the entire cost of benefits into the rate as a burden, much the same way that they add in the cost of FICA taxes. In other words, they see it, but you don’t. They can also factor in a portion of the cost in this way, and leave some for you to pay out of your paycheck. For example, you might be charged $13.34 per week for the left over cost of the benefits. They can also offer you the option to accept company provided medical coverage or instead take a higher pay rate, typically between $1.50 and $3 per hour. This option has the added benefit of giving you at least an idea about the value of the benefits being offered. In any case, you’ll want to know exactly how the agencies you’re communicating with are handling this.
In our next blog post, we’ll discuss some of the advantages and disadvantages of securing your own medical benefits and offer some tips on finding them.