A Health Insurance Plan to Love
One strategy: ?Not testing for stupid things you shouldn?t be testing for?

The Wall Street Journal
By Anne Kadet Oct. 17, 2014 4:10 p.m. ET

I know this sounds perverse, but I love my health-insurance company. For one thing, the coverage is cheap. And I?m talking Crazy Eddie, ?insane prices? cheap. I probably spend less on insurance than I do on takeout.

Then there?s the customer service. When I call, I get a live human who speaks fluent normalese.

But the best part is the company-run clinic. It?s in a huge downtown Brooklyn loft space that looks like a fancy yoga studio and functions as a sort of North Pole of holistic health care.

Not only do I get free physicals, I have a free health coach who emails every week about my running routine and coffee addiction. If I?m feeling bonkers, there?s free short-term counseling from an on-staff therapist. Best of all, after taking a blood sample, the clinic offers 42 styles of bandage including bumblebee, zebra stripe and silver glitter.

Freelancers Medical, the clinic arm of the Freelancers Union?s Freelancers Insurance Co., has been around for two years now, aiming to provide the city?s middle-class contract workers with the sort of team-based, VIP health care frequently available only to Bloomberg types.

And the experiment seems to be a success. The company says 86% of its surveyed clients say they?d recommend the service to a friend. The insurance has a 98% reenrollment rate.

Indeed, the place inspires strong loyalties. On a recent visit, I got to chatting with fellow patient Dan Finkelstein, a Park Slope techie. He started with Freelancers Insurance as a grad student, but kept his coverage through two full-time jobs, even though the premiums cost 10 times those of his employer?s insurance.

It isn?t just the free yoga, meditation classes and wait-free appointments, he says. During an emergency four-day hospital stay at Mount Sinai Hospital, his health coach was on the phone every day, coordinating records and pestering hospital staff. ?I?d tip her if that was allowed,? he says.

This model isn?t entirely without precedent. Many unions used to offer member clinics, says Freelancers Union founder and Executive Director Sara Horowitz. Some still do.

But while a clinic catering to, say Appalachian coal miners might focus on treating black-lung disease, she says, Freelancers Medical caters to the needs of urban writers, artists and techies. Hence, the emphasis on therapy, meditation and support groups.

?Because us freelancers are crazy?? I asked.

?Exactly,? she said. ?It?s a creative group. It?s anxiety and carpal tunnel.?

Freelancers Insurance says the free clinic actually saves money. Customers who make it their primary-care provider generate 11% lower claim expenses than the rest of the pool.

Preventative care is part of the equation, but Horowitz says the clinic also controls costs by eliminating what it sees as unnecessary expenses. A favorite strategy: ?Not testing for stupid things you shouldn?t be testing for.?

Freelancers Insurance and its clinic are thriving. Revenues funded the building and operation of clinics in Brooklyn and lower Manhattan; it?s now scouting sites in Upper Manhattan and Jersey City. It hasn?t hiked premiums in three years.

So if it?s such a win-win, why don?t we see this model everywhere?

First, the actual cost savings might not be all that impressive. Clinic-based care is almost always cheaper thanks to economies of scale, but there?s likely a self-selection factor at work as well. People who make the clinic their primary-care provider are likely younger and healthier than the overall pool, says Dahlia Remler, a professor at Baruch College?s School of Public Affairs.

And while Freelancers Insurance convinced 17% of its 24,000 members to join the clinic, an insurance company catering to a wider demographic might not fare as well. ?It remains to be seen how attractive this is for people with chronic or serious illnesses,? says Sherry Glied, dean of NYU?s Wagner Graduate School of Public Service.

Then there?s the conflict-of-interest question. Do you really want your insurance company providing your health care? But Ms. Glied says there are benefits to this model. While some folks cherish the idea of their insurer and doctor battling over treatment options, studies show that a closed system with one entity weighing the costs and benefits of various choices can generate better care.

Alas, by the end of the year, the grand experiment will end, sort of. The existing Freelancers Insurance plans don?t meet the provisions of the Affordable Care Act, and the company says it can?t meet the new regulations while maintaining reasonable rates. Going forward, it will be offering plans through insurance giant Empire, with its free clinic option tacked on.

I?m concerned about what this means for customer service, not to mention my wallet. While many members will see their premiums fall, folks like me who no longer qualify for a catastrophic plan will see their premiums jump 66%. That?s a lot of takeout.

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