As Obamacare's second-ever enrollment period gets underway, the program has a big cheerleader in Silicon Valley: the chief executive of Uber, the ambitious ridesharing company that lets private car owners overnight become professional drivers.
Travis Kalanick, also a co-founder of Uber, said the health-care law has been "huge" for his business. By creating a functioning individual market for health insurance, people have more flexibility to pursue the jobs they want, Kalanick said.
"The democratization of those types of benefits allow people to have more flexible ways to make a living,” Kalanick said during a Friday night dinner for reporters, according to Buzzfeed. “They don’t have to be working for The Man.”
More than half of insured Americans still get their coverage through the workplace, though the rate has been declining over the past decade. Drivers for Uber are classified as independent contractors, so the company does not offer them insurance.
Kalanick's comments highlight one of the arguments that supporters of the Affordable Care Act make for the law. By making it easier and more affordable for people to buy health insurance coverage on their own, people won't have to stay in jobs they don't want just for the health benefits.
This concept is known as "job lock," and we have some idea just how prevalent it is. About 27 percent of employees cited workplace health insurance as the main reason for staying in their jobs or not retiring, according to 2004 survey from the Employee Benefit Research Institute. A 2008 Harvard Business School study found about 11 million people stayed in their jobs just for the health insurance.
For a company like Uber, this also isn’t just about people not having to stay in jobs they don't like to get health care. It’s also about people being able to take jobs they do like that don't provide health care.
But there's also flipside to Kalanick's argument. By not paying for employees' health insurance, Uber saves tons of money, just as it also cuts costs by putting the costs of car ownership onto its drivers. The whole issue of how Uber treats its drivers lies at the heart of class action lawsuits filed in California and Massachusetts courts over the summer. The suits argue that Uber improperly classifies its drivers at independent contractors, when they should be counted as full employees entitled to employer-provided benefits, including health insurance.
It's pretty unclear how much money Uber's drivers actually make, but if they're on the lower end of the scale, taxpayers could be helping to cover their insurance under the health-care law. An individual earning between $16,105 and $46,680 can get subsidized health insurance through the Obamacare marketplace, and the same goes for a family of four earning between about $32,900 and $95,400. Adults earning less are also now eligible for Medicaid coverage in states that expanded their programs.
It's hard to corroborate Kalanick's argument that the ACA is encouraging greater employment in the sharing economy less than one year into the law's coverage expansion. Another Buzzfeed story last month found some anecdotal evidence on Internet message boards that workers in the sharing economy were indeed getting covered under the health-care law.
But for people who don't have insurance, the reformed individual market under the ACA is supposed to be more stable than what people faced before on their own. You can't get thrown off of coverage or charged more because of a pre-existing health condition. And most people going through the ACA health insurance marketplaces qualify for financial assistance to make coverage more affordable.
The question is whether Uber should be providing drivers with health insurance in the first place — and if not, whether American taxpayers should help cover the cost.