UnitedHealth to offer coverage to restaurant workers nationwide

UnitedHealth Group Inc., in Minnetonka, Minn., is partnering with the National Restaurant Association in a private-sector bid to offer health insurance to U.S. restaurant employees, reports the Los Angeles Times. The partnership, called the Restaurant Health Care Alliance, will begin with a limited release but eventually could provide insurance to the 4 million to 6 million restaurant employees who currently have no health benefits (10 percent of the uninsured in the United States).

The National Restaurant Association represents some 380,000 employers across the country. Providing health insurance "is a business issue," says Dawn Sweeney, the association's chief executive. However, narrow profit margins in the industry have made it difficult to find affordable insurance for the nation's 13 million restaurant workers, she says.

The alliance will roll out a website and provide UnitedHealth plan options for workers in Pennsylvania and Colorado this week. Expansion into California, Texas, Florida, Illinois and additional states will occur within a year. UnitedHealth will offer both employer-sponsored plans and individual coverage through the partnership. The employer-sponsored plans could cost 10 to 20 percent less than most HMO and PPO (preferred provider organization) products available in the small-group market.

However, those discounts could amount to little more than good public relations, says Sheryl Skolnick, an industry analyst at CRT Capital Group. Traditionally low-paid restaurant workers might not earn enough to make even a 10 to 20 percent discounted plan feasible.

While the alliance will begin offering health insurance to workers three years before the health reform law mandates coverage, that doesn't mean that UnitedHealth will necessarily get an early start on all health reform law requirements. The company will maintain its standard underwriting practices, so it could still be able to deny coverage for pre-existing conditions until 2014.

To learn more:
- read the Los Angeles Times article
- read the alliance's press release