Workers Affected by Living Wage Ordinance Focus on Health Insurance

orking poor families who are faced with the choice between paying rent or an insurance premium often view health coverage as a luxury. The lack of adequate health care coverage, combined with low-incomes, results in many families waiting until a medical problem has grown serious before seeking treatment. This puts low-income, uninsured people at higher risk for infectious diseases, perinatal problems, chronic health concerns and, ultimately, shorter life spans.

For these reasons, the Los Angeles Alliance for a New Economy (LAANE) advocated for passage of the Los Angeles Living Wage Ordinance, which includes a provision for health benefits. 

The ordinance requires most businesses benefiting from city contracts or subsidies to pay employees a minimum of $8.97 per hour without medical benefits or $7.72 per hour with medical benefits.

TCWF provided a $100,000, two-year grant to LAANE to conduct outreach and provide education about the importance of health insurance to workers and employers affected by the Los Angeles Living Wage Ordinance. Los Angeles’ Living Wage Ordinance was the first nationally to mandate a health benefits option.

“A societal issue as complex as ensuring access to health coverage to the working poor requires the involvement of many stakeholders to effect significant change,” said TCWF Program Officer, Lucía Corral Peña. “LAANE focuses their efforts not only on employers and businesses but also on public officials and the workers themselves.”

Many employers affected by the ordinance have chosen to pay the higher wage instead of providing health benefits. LAANE’s employer education focuses on the benefits to employers who choose the health insurance option, including reduced absenteeism and turnover, and on the importance of selecting an adequate medical insurance plan. 

Among employers who do provide health coverage, many offer plans that are not appropriate for the population, such as those requiring a premium or co-pay that is unaffordable for the workers. 

“Another key component is to educate the workers affected by the ordinance about the importance of health insurance,” said Madeline Janis-Aparicio, executive director of LAANE. “Many affected workers are immigrants from countries with socialized medicine who are unfamiliar with the whole concept of health insurance.”

The number of people without health insurance is increasing throughout California, especially in Los Angeles County. At 2.6 million, Los Angeles has more medically uninsured residents than any other urban area in the country. Of those, 85 percent are working people who do not receive health coverage through their jobs, earn too much to qualify for a public health insurance program and cannot afford private insurance plans.

Over the past year, LAANE has educated more than 2,000 workers and 400 employers affected by the ordinance. LAANE anticipates that both employer and worker educational efforts will increase. The development of a health trust appropriate for the needs of workers and employers affected by the ordinance is a top priority for LAANE this year. 

“We still have a lot of work to do, but are encouraged other California cities are beginning to include the health benefits option as they develop their own living wage ordinances,” Janis-Aparicio said. 

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