Affordable Care Act Costing Taxi Drivers Six Cents Per Fare
With the emergence of the Affordable Care Act, a six-cent fare tax has been added for all New York City cab drivers to fund both health insurance and disability insurance. But many taxi drivers were not advised on where this fee is going and how it will apply to them, causing thousands to sign a petition against it. According to CBS New York, about a dozen taxi drivers said they’re not pleased with the six cents they now have to pay on every fare for, among other things, help navigating the new health care law. (CBS Local, cab-drivers-spar-over-new-taxi-tax-to-help-with-health-insurance-sign-up, November 20, 2013)
“Taxi drivers in New York City work as independent contractors and as such, do not have access to healthcare or disability coverage offered and funded by an employer. As a way of providing assistance to New York City taxi drivers who will be required to obtain health insurance under the Affordable Care Act, the Taxi and Limousine Commission (TLC) has adopted rules that would require taxi drivers to pay $0.06 per taxi trip. This funding will be collected for the provision of healthcare insurance services and disability insurance,” (NYC Taxi & Limousine Commission: City of New York, 2014).
Taxi drivers often lease their cabs from a company so they don’t earn wages or a salary, they earn what they can from the rates they charge by driving people to their destinations. If a driver is ill and can’t work for a week, no money comes in until they are back on their feet and in their cabs, says Darras.
“Individual short- and long-term disability insurance is often the best option for independent contractors,” advises Frank N. Darras, America’s top disability insurance lawyer. “Short-term disability lets someone receive a percentage of their income in case they cannot work temporarily. Say a taxi driver can only work a short period of time every week due to a recent medical issue. The short-term disability policy will cover the remainder of his missed income if he can only work part-time, after a very short elimination period.”
A drivers’ income depends on the amount of trips they can procure, but if they are off for even a day they lose the money they need for food and rent along with support for their families. Disability insurance provided by the taxi company would help protect and provide for the driver because their day-to-day income is so important.
“Disability insurance can provide taxi drivers with great peace of mind,” says Darras. “Injuries and illnesses can happen without notice and if they have a family to care for, the loss of income can hit much harder. Individual policies can be tailored depending on what coverage they want to pay for, based on their income. In a metropolis like New York City, many insurance experts are available to help taxi drivers find a policy to cover their needs at a decent cost.”