In­surance sus­pended for movie work­ers

San Francisco Chronicle Late Edition - - BUSINESS - By Michelle An­drews Michelle An­drews is a writer for Kaiser Health News, a non­profit news ser­vice cov­er­ing health is­sues. It is an ed­i­to­ri­ally in­de­pen­dent pro­gram of the Kaiser Fam­ily Foun­da­tion, which is not af­fil­i­ated with Kaiser Per­ma­nente.

Be­fore the coronaviru­s pan­demic shut down the en­ter­tain­ment in­dus­try in March, Jeffrey Far­ber had a steady flow of day jobs in film and tele­vi­sion, in­clud­ing work on “Hunters” and “Blue Bloods.” But when the­aters, movies and TV shows stopped production, not only did Far­ber lose his act­ing in­come, he also stopped ac­cru­ing the hours and earn­ings he needed to qual­ify for health in­surance through his la­bor union, SAGAFTRA.

Without the act­ing jobs, his in­surance would be end­ing this month.

“This is an un­be­liev­able sit­u­a­tion,” said Far­ber, 65, a sur­vivor of pan­cre­atic can­cer. “There are go­ing to be so many peo­ple who aren’t go­ing to be able to make it.”

From Broad­way to Hol­ly­wood and the sound stages on Trea­sure Is­land and Mare Is­land, many ac­tors, di­rec­tors, back­stage work­ers, mu­si­cians and oth­ers in the per­form­ing arts face sim­i­lar coverage sus­pen­sions. Those in the en­ter­tain­ment in­dus­try of­ten have sev­eral em­ploy­ers over the course of a year as they move from show to show. In some ways, they’re quin­tes­sen­tial gig work­ers.

Their em­ploy­ers gen­er­ally make fi­nan­cial con­tri­bu­tions to a ben­e­fit fund un­der the terms of the union con­tract. And the work­ers pay pre­mi­ums on their coverage. If work­ers ac­cu­mu­late a pre­de­ter­mined num­ber of hours or earn­ings, they can qual­ify for coverage for up to a year. Coverage is typ­i­cally com­pre­hen­sive and quite in­ex­pen­sive. Far­ber paid just $408 ev­ery three months to cover him and his hus­band.

It’s a model some aca­demics think might work for oth­ers in the gig econ­omy.

“It makes coverage pos­si­ble in in­dus­tries like re­tail, con­struc­tion and en­ter­tain­ment where it might not oth­er­wise be of­fered,” said JoAnn Volk, a re­search pro­fes­sor at Ge­orge­town University’s Cen­ter on Health In­surance Re­forms.

As the pan­demic has shown, it doesn’t al­ways work well. Some­one in the en­ter­tain­ment in­dus­try may be able to weather a dry spell without any work be­cause he’s al­ready qual­i­fied for coverage based on past em­ploy­ment. But once coverage lapses, this sys­tem could leave en­ter­tain­ers at a dis­ad­van­tage over other work­ers re­turn­ing to a more con­ven­tional job, where coverage can start im­me­di­ately. Plus, mem­bers may con­tinue to owe union dues, even though they aren’t el­i­gi­ble for health ben­e­fits.

The tim­ing of the shut­down couldn’t be worse for Far­ber, who needed just 12 days of work or $249 in earn­ings by the end of June to qual­ify for con­tin­ued coverage in Oc­to­ber. Ac­cu­mu­lat­ing that would have been “easy as pie,” he said.

In the en­ter­tain­ment unions’ ben­e­fit plans, “coverage is al­ways prospec­tive,” said Phyl­lis Borzi, a former as­sis­tant sec­re­tary in the De­part­ment of La­bor who headed the Em­ployee Ben­e­fits Se­cu­rity Ad­min­is­tra­tion and is now a con­sul­tant. “That works fine if you have a short in­ter­rup­tion, but they’ve been out so long, to the ex­tent they have hours banked, they must be out of them by now.”

SAG­AFTRA rep­re­sents about 160,000 pro­fes­sion­als in TV, ra­dio, film and other me­dia. Though the en­ter­tain­ment in­dus­try is con­cen­trated in South­ern Cal­i­for­nia, an ac­tive North­ern Cal­i­for­nia chap­ter in San Fran­cisco rep­re­sents mem­bers from Fresno to the Ore­gon border. The union re­quires that mem­bers this year gen­er­ally must ac­cu­mu­late at least 84 days of qual­i­fy­ing work or earn $18,040 over four quar­ters to be el­i­gi­ble for coverage for the next four quar­ters.

Far­ber even­tu­ally got a tem­po­rary re­prieve be­cause he learned he could qual­ify for coverage with lower earn­ings un­der a sep­a­rate cat­e­gory for peo­ple who are least 40 years old and have 10 or more years of health plan el­i­gi­bil­ity. But he doesn’t know how coverage changes planned for next year will af­fect his el­i­gi­bil­ity.

The health plan has taken some steps to al­le­vi­ate con­cerns raised by mem­bers. In April, it cut health care pre­mi­ums in half for the sec­ond quar­ter and this month an­nounced a tem­po­rary re­duc­tion of CO­BRA pre­mi­ums for some mem­bers.

The SAG­AFTRA ben­e­fit fund didn’t re­spond to re­quests for com­ment.

Even in the best of times, it can be dif­fi­cult for those in the en­ter­tain­ment in­dus­try whose names ap­pear in small print in the cred­its to string to­gether enough work to qual­ify for coverage. If so­cial re­stric­tions were to ease and peo­ple could get work head­ing into fall, any ac­cu­mu­lated hours and in­come may be too far in the past to count to­ward fu­ture coverage, leav­ing them no choice but to start ac­cu­mu­lat­ing them all over again.

In con­trast, when em­ploy­ers hire some­one el­i­gi­ble for on­the­job coverage, they typ­i­cally can’t im­pose wait­ing pe­ri­ods longer than 90 days for health in­surance un­der the Af­ford­able Care Act.

Like peo­ple who work for a sin­gle em­ployer, work­ers who lose coverage through their union ben­e­fit plan can con­tinue their coverage for up to 18 months un­der CO­BRA, but work­ers who make that choice gen­er­ally have to pick up the en­tire cost of the plan. And CO­BRA coverage is not cheap. They may also en­roll in a plan on their state mar­ket­place set up by the Af­ford­able Care Act or, if they qual­ify, in

Med­i­caid, the fed­er­al­state pro­gram for low­in­come peo­ple.

When the pan­demic hit in mid­March, Dee Ni­chols had logged 512 of the 600 hours he needed to ac­cu­mu­late in a six­month pe­riod to qual­ify for health coverage with the Mo­tion Picture In­dus­try health plan.

Ni­chols, a cam­era op­er­a­tor in Los An­ge­les who is a mem­ber of Lo­cal 600 of the In­ter­na­tional Cine­matog­ra­phers Guild, had two shows lined up in early March that would have brought him up to the thresh­old by March 21, the end of his qual­i­fy­ing pe­riod for coverage. Then production was can­celed.

It wasn’t the first time that Ni­chols, 49, had missed qual­i­fy­ing for coverage.

“You’re try­ing to fill a tub of wa­ter and it keeps get­ting holes,” Ni­chols said. Mean­while, he pays $400 a month for an in­di­vid­ual mar­ket­place plan with a $6,000 de­ductible.

“They’re fine with guys like me con­tribut­ing and then not be­ing able to pull (ben­e­fits) out of it,” he said. “It drives me in­sane.”

The in­dus­try health plan also of­fered some re­lief to mem­bers, in­clud­ing ex­tend­ing them some hours of credit, waiv­ing pre­mi­ums for de­pen­dents and of­fer­ing CO­BRA sub­si­dies.

But the as­sis­tance didn’t help Ni­chols qual­ify for coverage.

He and an­other mem­ber are part of a clas­s­ac­tion law­suit ar­gu­ing that the health plan has a re­spon­si­bil­ity un­der fed­eral law to treat all plan par­tic­i­pants equally. The plan didn’t re­spond to a re­quest for com­ment.

To as­sist its mem­bers dur­ing the pan­demic, the Ac­tors’ Eq­uity As­so­ci­a­tion health plan waived pre­mi­ums for three months start­ing in May and is tem­po­rar­ily of­fer­ing a lower­cost plan through the end of the year.

But since these mul­ti­em­ployer plans are self­funded, they pay mem­bers’ claims di­rectly. That can cause prob­lems when work is scant and em­ploy­ers aren’t pay­ing into the fund.

“All of these health funds have dif­fer­ent fi­nan­cial po­si­tions, and they have to main­tain re­serves in or­der to main­tain coverage for their mem­bers,” said Bran­don Lorenz, com­mu­ni­ca­tions direc­tor of the Ac­tors’ Eq­uity As­so­ci­a­tion, which rep­re­sents about 52,000 ac­tors and stage man­agers.

SAG­AFTRA, which has pro­jected a $141 mil­lion deficit in its health plan this year, an­nounced far­reach­ing changes to coverage for next year, in­clud­ing higher thresh­olds on earn­ings and days worked to qual­ify for coverage.

That could prove an added chal­lenge for Jeffrey Far­ber, who is con­cerned about what job op­por­tu­ni­ties will be avail­able when the in­dus­try re­cov­ers.

“None of us knows when production is go­ing to start again or if we’ll work again,” he said.

Paul Ro­vere / Getty Im­ages 2019

Ac­tors, di­rec­tors, back­stage work­ers, mu­si­cians and oth­ers face sus­pen­sion of their health coverage.

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