If there’s one thing most experts can agree on about Obamacare, it’s that the participation of young people in state health insurance exchanges is crucial.
Without their presence, the exchanges would be filled with older, sicker individuals and costs would go up for both insurers and consumers. Obama administration officials have said they need to enroll 2.7 million U.S. residents between ages 18 and 35 in exchange plans to balance risk and hold down costs.
However, recent news coverage raises the concern that young adults lack enough awareness of the health reform law to actually seek out coverage.
Meanwhile, observers say that even if this age group had enough information, convincing them to buy a health plan still would be a tough sell. Young people might be reluctant to purchase something that they believe they’ll rarely use, observers say.
Unaware or Unwilling?
A Gallup poll released in August found that younger U.S. adults are less familiar with the ACA than older adults. According to the poll, 36% of respondents in the 18-to-34 age group said they are “not too familiar” or “not familiar at all” with the ACA, while 10% said they are “very familiar” with the law.
Meanwhile, a recent survey from the Commonwealth Fund found that just one in four young adults are aware of their coverage options through the ACA’s insurance exchanges.
The survey revealed that just 27% of 19- to 29-year-olds know that they can begin enrolling in health insurance exchanges in October. Low-income and uninsured young adults were the most likely to be uninformed, according to the survey.
The findings raise concerns that “many young adults will remain without health insurance in 2014 despite the [ACA]’s reforms,” according to the Commonwealth Fund.
While some young adults might not be familiar with the law’s provisions, Wall Street Journal‘s Christopher Weaver and Louise Radnofsky profiled several young adults who know about the ACA but are not convinced that they should spend money on health coverage.
The two reporters interviewed a 30-year-old mechanic with a $29,000 annual salary. The cheapest exchange plan for him would cost $147 monthly and include a $6,350 deductible. He also could spend $172 a month on a plan with a $2,500 deductible.
He’s not eligible for a subsidy because his income is too high. He told the Journal: “I’m not going to pay for that. It breaks down to: Can I afford it? And, am I getting my money’s worth?”
Under the ACA, policies for young people will be more expensive than they are today. That’s in part because insurers must offer coverage for what the law considers to be essential health benefits — and because younger, healthier individuals no longer will get the same preferential pricing that insurers have given them for years.
And while the ACA includes a penalty for not having health insurance, it is “a lot less than the full price” of a policy offered through the exchanges, Jonathan Cohn writes in The New Republic. In 2014, the penalty will be $95. By 2016, it will be $695 annually for a single adult and up to $2,085 annually for a family or 2.5% of household income, whichever is greater.
John Rowe — formerly Aetna’s CEO and currently a health policy professor at Columbia University — concurs, telling the Journal: “For healthy young people, I believe that these new rates are not likely to be attractive enough.”
The Case for Young Adults Buying Coverage
Jen Mishory — deputy director of the not-for-profit group Young Invincibles — told California Healthline that she believes many young adults are significantly concerned about having health coverage, citing a recent Kaiser Family Foundation poll.
The poll found that 87% of young people surveyed consider it “personally important” to obtain health insurance, while 88% said that insurance is “something I need.” In addition, 66% of respondents said they are concerned about paying medical bills in the event of a serious injury or illness.
Mishory said, “Everyone, no matter what age, is just one accident away from a health, and thus a financial, disaster if uncovered and need things like preventive care.” She added, “We also know that a lot of uninsured young people will qualify for Medicaid,” under an ACA-led program expansion, “or tax credits.”
For Cohn, the federal subsidies present a strong argument for young adults deciding to buy health insurance. He writes that for some, “the discounts will be pretty big,” using Kaiser’s ACA subsidy calculator to conclude that a 25-year-old with a $20,000 annual income could expect to pay about $503 a year for a bronze-level plan. As Cohn notes, “That’s just $42 a month.”
He continues, “Obamacare critics frequently dismiss the impact of these subsidies, saying that they will benefit only a ‘narrow slice’ of the population.” However, he cites a recent analysis by health policy researchers Adrianna McIntyre and Josh Fangmeier finding that the median income for a 25-year-old currently is about $25,000 annually, while a third of individuals that age have incomes below $23,000.
According to Cohn, some young adults in this income bracket will get insurance through the Medicaid expansion, and others might take advantage of an ACA provision allowing them to stay on their parents’ insurance plans until age 26. However, the “rest will be looking for private insurance and, when they go to the exchanges, they will find subsidies make insurance relatively cheap,” he writes.
Even with attractive insurance options, enrollment efforts will stagnate without outreach. Mishory noted that that Young Invincibles is “in the middle of a nationwide education campaign” — called Healthy Young America — to educate health and youth advocates about changes under the ACA and bolster on-the-ground health plan enrollment efforts, among other efforts.
Noting the appeal of sharing and receiving content digitally, Mishory said that Young Invincibles also is working with HHS on the Healthy Young America video contest.
The Huffington Post reports that the federal government will spend at least $684 million annually on ACA outreach efforts, which primarily will target young adults, working low-income individuals and people who gave up insurance because of the cost.
A Look Ahead
Even if outreach efforts are successful, the question remains: Do young adults value health insurance enough to buy it?
A poll released last week by The Morning Consult shows a favorable outlook: 35% of individuals ages 18 to 29 said they are “almost certain to purchase” or “very likely” to purchase health plans in the exchanges. Meanwhile, it found that 39% of such individuals are evenly split on the decision to enroll.
However, both Mishory and Cohn allowed for at least some skepticism about young adults purchasing Obamacare coverage.
“It’s really going to be an individual health and financial decision,” according to Mishory.
Cohn similarly posits, “It’s one thing to tell a pollster you think health insurance is important. It’s quite another to spend what it will take to buy insurance.”
Here’s a look at more health care reform-related news.
The Uncoverables: Sarah Kliff at the Washington Post‘s “Wonkblog” examines findings showing that even if all states expanded Medicaid under the ACA, millions still would be uninsured.
‘Death Panels’ Won’t Die: Austin Frakt in The Incidental Economist sounds off about the Wall Street Journal‘s evocation of “death panels” in a story looking at the ACA’s Independent Payment Advisory Board.
Don’t Blame the Regs: Allan Joseph at Project Millennial won’t take arguments against restrictions of medical resident work hours at face value.