For many travel agents, health insurance coverage is one of their top three expenses, costing thousands of dollars a year, and can have an impact on how advisors pursue their careers.
In an industry with a large population of very small businesses, it’s an even greater burden than for most entrepreneurs.
Lisa Wood Rossmeissl, who owns Boomerang Escapes, a small agency with independent contractors, is divorced and has health insurance only through her agency business. Based in Old Bridge, New Jersey, Wood Rossmeissl has a single-person plan with AmeriHealth where she pays $573 a month, a $50 copay and a $1,500 deductible.
She limits her medical visits currently to help keep her living expenses down. “I've only been to the doctor once a year, but I keep it in case of a serious accident or illness,” she said.
Agent Darby Savasta, owner of Darby’s Destinations in Mansfield, Massachusetts, pays $578 a month with a $1,000 deductible. Her children are on her ex-husband’s healthcare plan.
Despite the high monthly premium, Savasta, who once worked in medical billing, considers herself lucky to live and work in Massachusetts, given what she has seen and heard in other states. “I have five or six insurance options. Some people in some states find themselves with just one option.”
In California, agent Kathy Seifert has paid 25 percent increases in premiums each year the last few years for her 3-person plan with Kaiser Permanente. She and her husband are both self-employed, and are currently paying $850 a month for basic coverage that comes with a $12,000 deductible.
“So, it's basically only for major health issues, which luckily we're not affected by at this point,” she said.
Agents Lisa Chambers Fletcher and Margie Lenau also pay for plans with high deductibles. “I would love to know if there is a resource I'm missing,” Chambers Fletcher said. “I self-insure with Blue Cross/Blue Shield and my monthly premium is $562, just for myself. My policy is pre-Obamacare and I've actually been pretty lucky with annual increases. For 2018, it is going up only $4 per month — whew!”
Lenau is expecting a $50 per month increase this year with her United Healthcare plan, carrying a $7,500 deductible.
In some cases, the necessity and cost of health insurance has prevented some travel agents from fully pursuing their careers.
Jennifer Herbert, who works full time in a Virginia county government office, pays $36 a month for her husband and herself, with a $150 deductible. “My health insurance is the main reason that I don’t do travel full time. I have friends who own their own businesses and pay $1,000 a month for health insurance,” she said.
Lisa Costa, Freehold, New Jersey, also works her travel business part-time due to health insurance. “It is very disheartening because my love and passion is in my travel business but I could never afford, with three children, to pay out monthly for health care,” she said, adding how her husband is self-employed. “I have always carried the family health benefits.”
Could 2018 bring changes?
Agents facing steep health insurance costs are hoping that 2018 might represent a year where states and the federal government finally take the steps necessary to reduce the burden.
In the tax bill President Trump signed in late December are provisions that could impact healthcare coverage in America, and healthcare reform remains a top agenda item for Congress as it heads into the second term of the current administration.
In early January, the Department of Labor released proposed regulations that would allow small employers like travel agents to purchase their health insurance more easily from trade associations. Currently, Association Health Plans (AHPs) are difficult to administer because of state and federal laws.
The National Retail Federation (NFR) has backed AHP legislation in Congress, saying it would help small businesses (like travel agencies) compete with large companies in providing employee health insurance at affordable rates.
Retailers Association of Massachusetts President Jon Hurst testified on behalf of NRF during a House Education and Workforce Committee hearing in 2017, saying that the plan run by his group since 2012 has been able to “directly impact the cost of coverage” for more than 5,000 workers at 287 small businesses.
Some experts believe that the proposed Labor Department rules would also allow insurance companies to market lower-priced plans that also provided lower coverage.
However, for older agents, there is a growing concern that Medicare costs could rise.
In a December letter to Congress from AARP CEO Jo Ann C. Jenkins, that organization expressed concern about how a projected $1.5 trillion deficit created by the 2018 tax cuts would lead to an automatic cut of $25 billion in Medicare funding this year.
Jenkins said AARP believes those cuts “would have an immediate and lasting impact, including fewer providers participating in Medicare and reduced access to care for Medicare beneficiaries.”
The lucky ones
Many full-time agents, like Melissa Cornett Moatts, owner at Travel with Melissa in Peach Bottom, Pennsylvania, are married and have the benefit of a spouse’s employer’s health insurance coverage.
“My husband is retired from the military, so we are very fortunate to have affordable health care. Health insurance has never been a factor in my travel business. I feel very lucky,” Moatts said.
Susie Cleary Chau, founder at Dabble in Travel, Chicago, had a high deductible plan with a company where she worked. She paid under $70 a month for medical, vision and dental, before she finally decided to take the leap into running her travel business full-time. Her husband, being employed full-time with medical coverage, made that decision easier.
“I recognize I'm in a very fortunate position. I have consulted for a healthcare insurance company for a couple years and it's a challenging time for people,” Chau said, adding that she would like to see host agencies and consortia have the ability to offer health insurance to their agents.