2 minute read
Covering Your Assets
How to Retain Talent in Arizona’s Competitive Marketplace
“The United States now has more legal cannabis workers than dentists, paramedics, or electrical engineers,” said NewLeaf Captive CEO Philip Burghardt. “It’s on track to outpace manufacturing’s 525,000 workers by 2025.” If those numbers surprise you, you haven’t been watching the explosive growth of Arizona’s cannabis sector. In just one year, the state’s industry has outpaced some of the nation’s established legacy markets. Burghardt feels the largest increases to Arizona’s tech sector in 2022 will be in the labor market.
He created NewLeaf Captive, a group health insurance provider, to serve the cannabis industry’s growing workforce.
“I understand the challenges this industry faces day in and day out, including the demand for quality employees and the ability to retain those employees,” Burghardt said.
Finding insurance through a cannabis company has been nearly impossible since the legal industry began. Now, with 39 states offering some form of legal cannabis, it’s high time industry employers started offering insurance.
“Conflicting state and federal laws, emerging standardization of business practices, and rapidly evolving regulations have largely discouraged insurers from participating in this market,” said the National Association of Insurance Commissioners (NAIC) in a statement on cannabis and insurance. Cannabis is still an illegal substance under the Controlled Substances Act and the threat of federal prosecution has largely kept insurance companies out of the cannabis space. A 2020 report from New Dawn Risk reported there were only six insurers offering cannabis coverage in the U.S.
Dispensaries and ancillary cannabis companies employ nearly 21,000 people in Arizona. Leafly ranked it as number four in the nation for cannabis jobs. How are all these people protecting themselves and their families from unexpected medical payments? It’s largely up to the individual to secure private health insurance.
“In all other industries, a large percentage of workers will elect a lower paying job with a better benefit package vs. a high paying job with little to no benefits offered,” Burghardt said.
With more than a hundred dispensaries and dozens of ancillary companies operating, that’s a lot of competition for talented employees — and a lot of uninsured workers.
“To attract and retain these skilled employees, which companies have invested time and money in, these employers will need to offer group health insurance to compete,” Burghardt said. While many employers might be happy to offer insurance, paying large premiums while establishing a company in a new market could be expensive and risky. That’s one reason why NewLeaf is offering operators a portion of their cash back for unused coverage.
Despite the reluctance of the federal government to embrace the legalized industry, there are some positive pieces of legislation on the horizon. The Clarifying Law Around Insurance of Marijuana (CLAIM) Act would expand coverage options for businesses and remove federal barriers for insurers to work with legal cannabis-related businesses.
Until then, there are still insurance options available to cannabis businesses. “Choose a provider that empowers members to navigate the healthcare system while leveraging the convenience of modern technology. This puts members in control of their healthcare experience,” Burghardt said. ❖