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The GOP’s Health Plan Is Delusional About the Future of Jobs

The new proposal will be even worse for freelancers and the gig economy.

For those of us who cut our professional teeth in post-recession America, it was clear that the way we work had changed forever. Apart from a few industries, you could no longer graduate from college and expect a job in your field. You had to hustle, innovate and navigate the uneven pathways through failing corporate structures to do what you wanted.

As President Trump extols the virtues of job creation, he hasn't once addressed the new economy through which millions of Americans are getting paid, and that myopia has trickled into the GOP's latest health plan. The math is simple: between the White House ignoring the future of jobs, and Congressional Republicans pushing for a healthcare plan that hurts independent workers, the prospects for young people looking for a job and health insurance look bleaker than ever.

If the last five years are any sign, the old pipelines to employment are obsolete. Instead there is freelancing; the "contingent work" or gig economy; and quick, lateral moves. An estimated one-third of the US economy is powered by freelancers. Workers in non-employment businesses like Uber and Airbnb rose from 15 million in 2007 to 24 million in 2014. And for those of us working full time with a company, our generation is still known for switching jobs three times as often as our predecessors.

"Contingent work is the central drift of the labor market. It has been for a while and it will almost certainly be for the foreseeable future," Mark Muro, an economist at the Brookings Institution, told me.

When the GOP released a new healthcare proposal this week, my first thought was: who is this for? The new plan, meant to replace the Affordable Care Act, is a strange mix of private and public healthcare. And there are no signs that the lawmakers who drafted the legislation know who is working in America, and how to support them.

The plan, for instance, lets insurance companies charge people more for having a break in continuous health care coverage. That means if there's any point where you can't keep up with insurance premiums—if you're between jobs, or if you got laid off, or if you're an entrepreneur about to start your own company—your insurance company can charge you 30 percent more for a full year once you sign up again. This, in turn, could disincentivize people from even buying new coverage, since they'll be paying for the transition.

There are no signs that the lawmakers who drafted the legislation know who is working in America, and how to support them.

The Affordable Care Act was imperfect, and sometimes too expensive for average Americans, but it was often a boon for people working independently. The state and federal healthcare marketplaces allowed for anyone, regardless of their employment status, to buy subsidized insurance at a fixed cost. That has enabled freelancers and flexible work to flourish across the country.

"That relationship to the employer has been disappearing, so a lot of workers are much dependent on items like the ACA, which has been a godsend in the space," Muro said.

There are many reasons for working independently instead of within a company. About half of the people in this economy do it by choice: independent contractors can make more money and have more flexibility. For others, driving for Uber and Lyft might be the answer to unemployment. But in either case, this is a group that continues to be bulldozed by their decisions.

"There's this idea in the gig economy that you can hire employees and, as an employer, you're so far removed that you're not responsible for low wages or sexual harassment or benefits. That you have no responsibility at all when you pay people poverty wages," Kendall Fells, an organizer for Fight for 15, told Motherboard last year.

Read More: When No One Has a 'Job', Who Will Pay Workers a Minimum Wage?

Not providing viable health insurance options to these millions of working people would not only cripple a labor force, it would also make healthcare more expensive for the rest of the country by taking them out of the market altogether.

These challenges will be especially hard for older Americans, 44 percent of whom work independently, and who often have more healthcare need. As Sarah Kliff pointed out in Vox, the Republican plan allows insurance companies to charge older Americans more than younger ones. A Rand Corporation report estimated that premiums for a 64-year-old would spike from $8,500 to $10,600.

The new health proposal retains some key parts of the ACA: insurers can't charge people more for preexisting conditions like diabetes or heart problems, and young people can stay on their parents' plans until the age of 26. But in the end it cuts taxes on the rich, supports already healthy people, and could force people out of independent employment.

"At minimum the costs are likely to go up in the model that was announced," Muro said. "It certainly sounds like it will be a shakier source of care."

For the millions of Americans trying to craft a livelihood in the current economy, that will not work.

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