Working part time comes with certain obvious drawbacks. A part-time job pays less money than a full-time position and may offer fewer company perks. However, you may not have to give up access to one important benefit — health insurance coverage.
Many employers offer health coverage to part-time employees. However, you won’t find decent health care benefits just anywhere. Here’s what you need to know about finding a part-time job with health insurance.
- You may have to work for a large employer. The 2011 Employer Health Benefits Survey from the Kaiser Family Foundation found that 42 percent of large employers offer health insurance benefits to part-time employees. For firms with less than 200 workers, 15 percent offer health insurance to part-timers. “It’s a pretty big difference,” says Paul Fronstin, director of the Health Research and Education Program at the nonprofit Employee Benefit Research Institute in Washington, D.C.
- Coverage isn’t a given. In many cases, you’ll have to work at least 20 hours a week to qualify for health benefits, though the minimum varies by employer. Some consider 30-hour-a-week employees to be the full-time equivalent. You may also have to be employed for a certain length of time, such as 180 days, or rack up a total number of hours on the job.
- You may have to pay more than a full-time employee for your benefits. Companies often contribute less to the monthly premium for part-time workers, says Andrew Webber, president and CEO of the nonprofit National Business Coalition on Health in Washington, D.C. You may also have higher copays and more responsibility for out-of-pocket costs, he says.
What to expect
The good news is that other than the price, you can likely expect coverage similar to what full-timers get. “The benefits aren’t likely to differ a lot between full time and part time,” says Fronstin. “They’re usually but not always in the same plan.”
Bare-bones part-time health insurance plans cover medical bills only. Better ones include prescription drugs, dental, vision and even dependent coverage. In some cases, you may have access to flexible spending accounts.
One of the most important benefits of employer-sponsored coverage — no exclusion for pre-existing conditions — will almost certainly be included with even the slimmest health insurance plan for part-time workers, according to Webber.
Coverage for pre-existing conditions makes a part-time job with health benefits especially attractive if you would otherwise have to purchase coverage on the individual market, where coverage for pre-existing conditions is often excluded.
One potential cloud on the horizon if you’re working part time is the 800-pound gorilla in health care: the Affordable Care Act, or ACA.
How health care reform could affect part-timers
One problem with the ACA is that while it requires employers to offer health insurance coverage to full-time employees starting in 2014, which it defines as those working at least 30 hours a week on average, it’s silent on part-time workers.
No one really knows what the effect of the national health plan will be on employer-sponsored health insurance for part-timers, says Sara Collins, vice president of Affordable Health Insurance at the Commonwealth Fund, a private foundation headquartered in New York. She notes, however, that the law calls for the establishment of health insurance exchanges that will allow people who aren’t covered by employer plans to purchase coverage.
Some observers expect that the mandate that all individuals obtain health insurance, coupled with the availability of health insurance exchanges, will lead many employers to drop coverage for employees because they’ll see the exchanges as a viable option. However, a 2011 national survey by human resources consulting firm Mercer found that most employers don’t plan to drop health benefits as a result of the health care law — just 9 percent of all employers with 500 or more employees say they are likely to end their health plan after 2014. Bank of America, for example, is evaluating the law’s impact but has no current plans to change its health benefits for part-time employees, according to Jim Huffman, U.S. benefits executive for Bank of America.
For the moment at least, health benefits remain an option for part-time employees at many companies. The Bankrate feature “10 part-time jobs with health insurance” is a gallery that highlights 10 firms that offer coverage.