Inland Empire’s booming warehouse industry brings jobs – not health care coverage

The airless warehouse in Murrieta was usually sealed shut — not even a cracked door for a light breeze to sneak in. Luis Rossy remembers working through the night with a constant cough, the same cough all his co-workers had, as they processed large shipments of bread.

The cargo would arrive. He would sort it. Count it. Check it twice. Stack the crates on dollies. And then a caravan of semitrailer trucks would pick up and distribute it. The bread would eventually be stocked on the shelves of grocery stores, markets and corner shops throughout Southern California.

“I was working as much overtime as I could,” Rossy, 30, recalled. “At one point, I was in dire need of health benefits. I was having a lot of anxiety trying to juggle my home situation and work. Therapy was much needed, and I began having problems breathing and having respiratory issues.”

But without health insurance, care was unaffordable.

Similar to many low-wage employees in the Inland Empire logistics industry, Rossy said he didn't qualify for health insurance benefits from the warehouse or the staffing agency that connected him to the job.

Rossy’s situation illustrates a dynamic that sets the Inland Empire apart from most of California, according to regional experts and studies. The uninsured in the region, consisting of Riverside and San Bernardino counties, includes a much higher percentage of workers who are eligible for free, low-cost or subsidized insurance through Medi-Cal or Covered California than the average statewide. Yet they remain without health coverage.

That’s largely because low-wage workers in the region often lack health insurance options from their employers, according to those who follow the local economy. Others qualify for insurance through Covered California, the state’s insurance exchange created through the Affordable Care Act, but find even its subsidized plans too costly to afford. And some qualify for free care through Medi-Cal, California’s Medicaid program, but may not be aware of their options and remain uninsured.

“The gig economy offers workers flexibility and a steady stream of income, but it comes at the cost of other important things like health care access,” said Veronica Alvarado, program coordinator at the Ontario-based Warehouse Resource Center, a nonprofit dedicated to improving working conditions in Southern California’s warehouses.

Low-income workers can’t afford insurance  

The percentage of uninsured residents in Riverside, San Bernardino and Imperial counties  has dropped by more than half since the state implemented the Affordable Care Act, according to the Insure the Uninsured Project, as it has statewide

But when it comes to who is uninsured, the Inland Empire’s numbers diverge from the state as a whole. The focus statewide has been on undocumented adult residents who are not eligible for government-sponsored health coverage.

Yet that group is expected to make up a lower percentage of the 490,000 uninsured in the Inland Empire than in California as a whole by 2020, according to the latest projections by the UC Berkeley Center for Labor Research and Education and the UCLA Center for Health Policy.

Additionally, a far higher percentage of uninsured in the region could be eligible to sign up for Medi-Cal or subsidized Covered California plans.

The figures make sense to those who have worked with and studied the uninsured in the region.

In 2016, 41%  of the Inland Empire’s workforce was employed in low-wage jobs (defined as less than $14.35 per hour), compared with 32% for the state as a whole, according to the UC Berkeley Center for Labor Research.

Two of the biggest industries in the region, agriculture and warehouse work, typically don’t offer insurance because they employ seasonal or temporary workers who generally don’t qualify for full-time benefits, according to Bradley Gilbert, executive director of Inland Empire Health Plan, the largest not-for-profit Medi-Cal and Medicare health plan in the region.

The Affordable Care Act requires employers with 50 or more employees to offer health insurance that is affordable and meets minimum requirements set by the state.

Yet only 42% of adults under 65 in the Inland Empire had employer-sponsored health insurance compared with 51% statewide in 2017, according to UCLA’s California Health Interview Survey.

Federal data show that the dilemma facing the working poor extends beyond the Inland Empire.

Only one in seven working poor received health insurance through a job in 2017, compared with more than 84% of middle-class U.S. residents, according to the Kaiser Family Foundation.

Though overall rates of the uninsured don’t tend to vary significantly from one place to another, the reasons for being uninsured sometimes do. For example, undocumented residents are expected to comprise by far the largest share of the uninsured in Los Angeles County in 2020. In the Inland Empire, meanwhile, the share eligible for free or subsidized government-sponsored health insurance is expected to exceed the number of undocumented uninsured by 70,000.

But developments in Sacramento could change the landscape. The newly approved state budget expands Medi-Cal eligibility to young adults who are undocumented and under age 26, and it will create an individual mandate to buy insurance in California — to replace a federal mandate overturned by Congress. The state mandate carries a penalty for going uninsured that will likely drive more Californians to get covered.

Additional subsidies for those who rely on Covered California could bring relief to both the poorest of those eligible for the state exchange as well as Californians who currently make just a little too much to qualify for federal subsidies.

Warehouses brought jobs but not health care

The low-paid warehouse sector is one of the largest employers in the Inland Empire. The agriculture sector employs far fewer people and pays its workforce half the annual wage of those working in warehouses, according to federal data.

The USC Center for Health Journalism News Collaborative tried to reach several businesses and industry groups for comment on their employee health insurance policies, but none responded to our requests.

Many workers in the region who lack health insurance try to self-medicate, use alternative treatments or seek health care outside the country, in places such as in Tijuana, Mexico, said Alvarado, the program coordinator at the Warehouse Resource Center. They also seek care in emergency rooms and urgent care centers.

“We need to start acknowledging the impact these precarious working relationships are having on our communities,” she said.  

Ellen Reese, a professor of sociology at UC Riverside, interviewed more than 350 Inland Empire warehouse workers in 2012 and 2013, before the Affordable Care Act had been fully implemented. At that time, she said, 70% to 85% of the workers did not have health insurance.

“Lack of access to health care was creating a lot of mental anxiety and stress,” she said. “Since a lot of them are temp workers, they worry that complaining about lack of benefits will make them less competitive when it’s time to find a job. These workers are truly in a vulnerable position.”

Efforts to provide needed care for the uninsured in the region recently suffered a blow with the sudden closure of the Health to Hope Clinic, which offered free or reduced-cost medical services before ceasing operations in April.

In 2018, the clinic served 4,200 patients through its facility in Riverside as well as mobile units. Of that total, 20% were uninsured. Now the region is scrambling to find resources to provide care to those patients impacted by the closure.

“Anything that the state does to make sure every human being has access to affordable, high-quality health care is a good thing,” said Bill Ballas, CEO of the defunct clinic.

Warehouse workers who are undocumented face even worse prospects.  

Blanca Zarazua, 46, of San Bernardino, said she worked about 40 hours a week at a warehouse in Riverside where she made $12 an hour. She was injured at work in early 2019 when she tripped on empty boxes cluttered around the warehouse, causing pallets to fall on top of her. She had no health insurance, so she chose to wait a few days before she could seek care from a free clinic in Los Angeles with which she was familiar.

“Every day, every month, families are faced with decisions of having to pay the rent and car payment, purchase food or clothes, or pay for medical,” said Claudia Castorena, co-founder of the Galilee Center in Mecca. “So, I would say, health care is always at the back of that list, and it is a tough and unjust decision to have to make.”

Follow the USC Center for Health Journalism Collaborative series "Uncovered California" here.