Written by: Travis Kemper, PT, DPT – Jared Casazza, PT, DPT – Whitney Eakin, PT, DPT, ATC
Do Travelers Receive Benefits?
Many prospective travel therapists are under the impression that travelers do not receive corporate benefits, such as health insurance, 401k, dental insurance, etc., or that they are much worse than average. This is a misconception, and all the companies we work with (and most others) offer benefits packages that are very similar to a hospital or clinic position, and in our experience better than most small businesses due to having more employees and benefiting from economies of scale.
You also have the option to opt out of these benefits if you choose to enroll in your own health insurance, or if you are covered by a parent or spouse’s insurance, and/or if you want to forego the other benefit options.
There are some important differences to highlight between benefits offered for travel therapy contracts and more traditional full-time permanent jobs. Keep reading to find out more about the benefits offered by travel therapy companies!
When Are You Covered?
The sometimes tricky part about benefits when working with travel companies is that, generally speaking, you are only covered while you are on contract. Most companies will continue to cover you for a certain period between contracts (usually 15-30 days), as long as you resume work with that company for your next contract within the specified time period. This allows for a few days to a couple weeks off between contracts if desired. However, if you terminate employment with a certain company and take your next contract with a new company, you will not be covered during the interim. Similarly, you will not be covered if you take extended time off between contracts over the allowed period mentioned above. Of course, for health insurance, you can always sign up for COBRA coverage as needed if you plan to take longer off between contracts or are switching between companies. This is certainly a viable option for those of us that enjoy the flexible schedule with a career as a travel therapist, which involves reaping the benefits of an alternative lifestyle!
Because of the potential lapse in health coverage, and because switching retirement accounts may be a hassle, it is typically more desirable from a benefits perspective to stay with the same travel company continuously. However, many travelers will choose to switch companies based on the jobs available, or if they realize they like a different company/recruiter better. You just have to take into consideration what this will mean for you in terms of benefits (especially insurance coverage and potential 401k matching). This is one reason that some travelers might choose to maintain their own health insurance and retirement accounts independent of the company benefits. We certainly universally endorse the idea of having an Individual Retirement Account (IRA) outside of the travel company sponsored 401k plan (if available), but whether or not to have your own health insurance plan outside of the company sponsored option is a more individual decision to be made with regard to a variety of variables.
You also have to take into account when benefits coverage begins for each company. Some companies will offer benefits enrollment and health insurance coverage on day 1 of your contract. But for others, your coverage may not start until day 30 of your contract or perhaps the first of the next month, which could leave you without health insurance for a period of time. It’s important to look at each company’s benefits package closely and ask these questions to fully understand the coverage you will receive and to determine the best course of action for yourself.
Every company has different plans and options, but in general most companies offer a high deductible health plan and/or a PPO option. Some will also offer a third option that is the minimum allowed under the Affordable Care Act (ACA) and is basically just “preventative” in nature. For all of us mentors, the high deductible plan with 100% coverage after meeting the deductible is perfect because we are young, healthy, and very rarely in need of medical coverage. This type of plan still covers us in case of a major injury while skiing or hiking, or something like an emergency appendectomy, all of which would be completely unforeseen. The lower premium is the real benefit of the higher deductible plans, since this means more money in our pockets at the end of the week. These plans also allow us to utilize a Health Savings Account (HSA) to save for future healthcare expenses. Since a lot of the travelers that we mentor are younger and generally in good health, meaning they are unlikely to meet their deductible in either scenario, a high deductible plan can make the most sense, but that is certainly not universally the case. There are lots of other options based on your, or your family’s, individual needs. It’s important to remember that premiums and deductibles are always a balancing act, at least in terms of finances, in any health insurance plan and to consider all options before choosing. For more information on the difference between plans if you’re having difficulty choosing, here’s a good article on the topic!
Again, this is going to be different with every company. But these benefits are almost always available in the benefits packages, and they usually only cost a few dollars per week. Similar to the health insurance option differences discussed above, you will often have more than one option with varying levels of coverage and therefore varying premium amounts. If you only plan to be on contract with a company for part of the year and don’t need those benefits during that period, you can even opt out of them completely which will save you from paying for the premium out of each paycheck for a benefit you won’t utilize.
Employer Sponsored Retirement Accounts (401k)
This is often overlooked, especially with new grads and people in their 20’s and 30’s who may just be focusing on paying down debt rather than investing. However, it’s great to take advantage of a 401k early in your career to maximize the benefit of capital gains as they money grows over the years. This applies as well even when done in conjunction with paying down debt, since a combination of the two (paying down debt and investing) will usually lead to the best outcomes over the long run. Taking advantage of investing in a 401k is especially important if your employer offers a match.
Most travel companies do offer 401k, but it just depends on how long you work for them as to when you are eligible. Some companies make you eligible to start contributing immediately, while others make you wait 30 days, or a full contract. Also, many companies offer an employer match, which varies but could be something like 50% of your contributions, up to a contribution of 6% of your taxable income (meaning they would match up to 3% of your taxable income if you contribute 6% or more). However, sometimes there is a vesting period where you are not able to keep the money they match until you have worked with them for a certain number of contract hours. Some will have a tiered vesting period. For example, if you work with them for one full year, you get to keep 25% of the match; two years 50%; and three years 100%. Others might have an all or nothing vesting period (also known as a “cliff”), where you have to work with them the equivalent of three full working years (sometimes more or less, but this seems to be the most common) until you keep their match. It’s important to read the fine print and talk to your recruiter or benefits team to understand the 401k plan for a travel company you plan to work with if you want to utilize this benefit. Even if the company you work for either doesn’t offer a match at all, or you don’t plan to stay with them long enough to be able to keep the match, the importance of taking advantage of a 401k account early in your career for the tax benefits offered cannot be overstated! Since this is an important benefit for us, 401k plans are available through all of the companies we recommend.
Usually a small policy (around $50,000) is standard in each benefits package, with increased policy amounts available at increased premiums. We would recommend buying life insurance privately if you want increased policy limits, if you plan to switch between travel companies often, or if you take extended time off between contracts, so that you would have life insurance coverage continuously. But whenever this benefit is available through your employer at no additional cost, we would definitely recommend opting in since there’s no additional cost involved and there’s at least a small amount of coverage!
Some companies may offer some other benefits including: vacation pay (PTO); sick time; short term and long term disability insurance; CEU reimbursements or access to online CEUs for free; or even a free vacation! These additional benefits are by no means standard and vary greatly between travel companies.
Something to be conscious of is that benefits like PTO, sick time, disability insurance, and 401k will be based on your hourly rate, which as a traveler is generally $18-25/hour for example for a PT, OT or SLP, since you are also receiving additional money in the form of stipends. Since the hourly rate as a traveler is lower than that of a permanent employee, this will decrease the amount you would receive for PTO, disability pay (whether short or long term), or 401k matching compared to a permanent job. Just be aware of this, because it is often a cause of confusion among travelers. It’s also important to note that since taxable pay is lower as a traveler, meaning less money paid in taxes, there is also less money being paid into Social Security and Medicare in the form of FICA taxes, which could potentially mean a lower payout at retirement age. The good news is the extra income you receive more than allows you to make up for the differences plus some! To learn more, read our comprehensive guide to pay as a traveler versus a permanent employee.
Final Note on Traveler Benefits
Travel companies are usually able to offer the same, or better, benefits to their travelers as other employers would at a permanent job. Sometimes these benefits may look a little different based on your hourly pay, and sometimes your coverage could be a bit of a hassle if you are taking extended time off or switching between companies. It’s important to consider the benefits offered when choosing a travel company. Quite often, travel companies have a lot of the same jobs, but their benefits packages might just make the difference in your choice between companies!