Jockeys and Health Insurance

Recently, the Jockeys Guild has been making a strong push for someone, anyone really, other than the jockeys, to provide health insurance for riders and their families. In New York, the Governor's Office has convened a Task Force on Jockey Health and Safety to consider that issue, among others. The Task Force is chaired by NYRA Director and thoroughbred owner Anthony Bonomo and includes jockey John Velasquez, retired rider Ramon Dominguez, Jockey Club staff member Nancy Kelly and attorney Alan Foreman, who represents a variety of horsemen's groups, including the New York Thoroughbred Horsemen's Association ("NYTA").

Disclosure: I've been a member of the NYTHA Board of Directors since 2002. I also have some knowledge of health care issues at the track, through my involvement as a Director since 2009 of the BEST Backstretch health care program, which provides basic health care and substance-abuse services for backstretch workers at NYRA Tracks.

I've been told that a major item of discussion at the Task Force meetings has been: who should pay for health insurance for jockeys and their families? As I understand the Jockeys Guild position, it's that either the race tracks or the owners and trainers should bear this cost, and not the jockeys themselves, except perhaps to the extent of a very limited contribution.

Seems reasonable, right? After all, owners, trainers and track executives aren't the ones taking the risk of riding a 1,200-pound animal at 40 miles an hour in close company and under sometimes less than perfect conditions. Jockeys literally put their lives on the line every time they ride, so shouldn't they get our help?

But a closer look at the situation, at least in New York, raises some questions. Is financing health insurance for jockeys and their families really the best use of money from tracks' budgets, when many needed repairs are still waiting on limited budget funds? Is taking yet another slice off the top of owners' purses to pay for that insurance wise at a time when, despite slots-enhanced purses, most race horse owners still lose money? Why provide health insurance for jockeys when trainers, many of whom earn less than jockeys, have no insurance plan from the track and have to buy their own personal or family coverage?

In some racing jurisdictions, where purses are low, jockeys don't have coverage for on-the-job injuries, and jockey income flirts with the poverty line, perhaps there's an argument to be made for assisting jocks with health insurance premiums. But in New York at least, that argument doesn't apply. Here's why:

First, jockeys in New York already have two forms of insurance coverage for work-related injuries. The Jockey Injury Compensation Fund provides workers compensation coverage, including ongoing medical care, for on-the-job injuries to jockeys and exercise riders. The Fund is financed by owners, through a deduction from purses, and by trainers, through a per-stall fee that is probably usually passed along to owners as part of the trainer's day rate. In addition, NYRA pays for an accidental death and injury policy that pays those jockeys who sign a waiver (agreeing not to sue NYRA) 10 times their annual earnings, up to a maximum of $1.3 million, if the jockey is paralyzed and up to $956,000 if the jockey is permanently impaired. Those payments are on top of the workers compensation payments through the Jockey Injury Compensation Fund.

Second, jockeys in New York make a pretty good living. Using statistics available from Equibase, it's possible to calculate the gross earnings of most regular New York riders. In New York, jockeys generally get 9.17% of a win purse, 5% of second-place money, and 7.5% of third-place money. Because win purses are the major element in any jockey's income, this works out to a blended rate of about 8% of total purse money won.

Using those parameters, and using the Equibase data for 2012, the first full year of slots-enhanced purses in New York, one can calculate that 22 jockeys made over $100,000, just from their rides in New York, not counting anything they earned out of state. For example, the now-retired Ramon Dominguez had purse earnings of over $19 million in New York, of which his share was in excess of $1.5 million. Other jockeys who earned over $400,000 just in New York include Cornelio Velasquez, Junior Alvarado, Javier Castellano, Irad Ortiz Jr., Jose Lezcano, David Cohen, Eddie Castro, Alan Garcia, John Velazquez, Rajiv Maragh, Joel Rosario, and Rosie Napravnik. Using the same methodology, we can conclude that the following riders made between $100,000 and $400,000 just in New York in 2012: Jose Ortiz, Wilmer Garcia, Mike Luzzi, Samuel Camacho Jr., Edgar Prado, C C Lopez, Jose Espinoza and Corey Nakatani. Adding in jockeys who earned less than $100,000 in New York but who had earnings elsewhere that would lift them above the $100,000 threshold would add the following to the list: Jose Rodriguez, Kent Desormeaux, Dennis Carr, Joe Bravo, Shaun Bridgmohan, Pablo Morales, Luis Perez, Jose Valdivia Jr., Chris DeCarlo, Pablo Fragoso, Alex Solis, Jaime Rodriguez, Mike Smith and Kevin Navarro.

Update (1/16/2014): I just ran the 2013 numbers, using the same methodology. They show that 24 riders likely earned over $100,000 just in New Yoerk. In order: (a) over $400,000 -- Javier Castellano, Irad Ortiz Jr., Junior Alvarado, Jose Ortiz, John Velazquez, Cornelio Velasquez, Joel Rosario, Jose Lezcano, Luis Saez, Rajiv Maragh; (b) $100,000-$400,000 -- David Cohen, Edgar Prado, Alex Solis, Mike Smith, Manuel Franco, Eddie Castro, Rosie Napravnik, Mike Luzzi, Joe Rocco Jr., Guillermo Rodriguez, Keiber Coa, Abel Lezcano and Angel Arroyo.

That's a lot of riders with incomes that many racegoers wouldn't mind having. True, jocks generally pay their agents 15-25% of their earnings, and their valets get 5-10%, but still, these are solid, middle-class incomes, and well above the national average.

Moreover, jockeys in New York have received a substantial pay raise as a result of the increase in purses since 2011 fueled by slot-machimne revenue. Still using our 8% methodology, we can calculate that aggregate jockey earnings at NYRA tracks increased by some 40% from 2011 to 2012, right in line with the increase in purses in that period.

In the past, jockeys had a strong argument for having the tracks and/or owners supply health insurance, because most riders would have "pre-existing conditions" that insurance companies would cite in order to deny coverage. But, under the Affordable Care Act ("Obamacare"), insurance companies can no longer use that excuse; they must make standard policies available, regardless of pre-existing conditions.

Jockeys are independent contractors. With rare exceptions, they are not employees of a particular trainer or owner (for a taste of the bad old days, when they were, listen to Slaid Cleaves' song "Quick as Dreams," about Jockeys Guild founder Tommy Luther.) Like solo practice lawyers, free-lance writers or, for that matter, horse trainers, they're responsible for themselves. Unlike those other categories, though, at least jockeys have pretty good insurance coverage for work-related injuries.

Given that on-the-job coverage, given that insurance companies can no longer deny them and their families routine health insurance, and given their level of income, at least in New York, it's hard to make a case that jockeys should be treated differently from other independent contractors and sole proprietors. Those that have high incomes -- and I was surprised by how many there were in that category in New York -- can buy comprehensive health insurance for themselves and their families in the market. Those with lower incomes can use the Affordable Care Act's insurance exchanges to obtain very acceptable policies and, if their incomes are low enough, can get tax credits and subsidies to cover part of the premium cost.

The New York Task Force on Jockey Health and Safety can do a lot of good things. Improving vests, helmets and other protective equipment would help. So would stiffer standards for licensing riders, to make sure they're up to the level of competition in New York, and ongoing continuing education programs. So would providing nutrition advice so riders can keep their weight down without destroying their bodies. So would tougher penalties for dangerous riding. Health insurance for jocks and their families? Not at the top of the list.

If you feel the same way, you might want to let Anthony Bonomo, chair of the Jockey Safety and Health Task Force, know. You can reach hiom at A.Bonomo@medmal.com.