Federal outsourcing increases uninsured
How Government Adds To Ranks of Uninsured
By Jane Zhang
The Wall Street Journal
March 25, 2008
Covering the uninsured is a central issue in this year’s political campaign. Yet while politicians debate how best to cover the growing ranks of the uninsured, the federal government — by outsourcing service jobs — quietly is adding to those numbers. “As federal employees, we get great insurance,” says (Dr. William Rogers, a medical officer at the Department of Health and Human Services). “People who work as contractors often don’t enjoy those benefits.”
Federal contract employees, including cafeteria workers, security guards and cleaning crews, work on Capitol Hill and in federal agencies across the country. Under a 1965 law, called the McNamara-O’Hara Service Contract Act, most contractors with service contracts of more than $2,500 are required to pay locally prevailing wages, plus fringe benefits or the cash equivalent — $3.16 an hour this year, under a government formula.
Yet some contract employees don’t get either the health insurance or the extra cash. Under the law, employers in industries where health insurance typically isn’t offered are exempt. Other employers don’t comply with the law because they don’t understand it or assume they won’t get caught, say lawyers and consultants who work in the field.
Some contract workers who get the $3.16 in extra cash use it for rent, food or other things rather than health insurance. Federal contract workers — even if they wanted to pay for it — aren’t eligible for coverage offered to regular federal employees.
Outsourcing of federal-government jobs reflects the same cost-cutting imperatives that drive private businesses to outsource. The U.S. government keeps tabs on how much it pays contractors, but no government agency keeps a tally of the workers who are employed or how many have health insurance. Paul Light, a political scientist at New York University’s Wagner School of Public Service and a specialist on government employees, estimates that in 2005, there were 5.4 million federal service-contract workers, double the number in 1990.
About 80% of those, he says, are lower-wage workers, the ones less likely to be offered or to obtain health insurance. “A substantial number of lower-level white-collar and blue-collar contract workers do not have health insurance,” Mr. Light says. “Either they don’t purchase it or aren’t provided it through their employer,” he says.
http://online.wsj.com/article/SB120640675912461079.html
Comment:
By Don McCanne, MD
We won’t get it right until we’re ready to automatically enroll absolutely everyone in a single national health program. Until then, even the government will game the system.