Study: Health Care Costs Higher for Young Adults Newly Covered by ACA

Young adults who enrolled in a parent's employer-sponsored health plan after an Affordable Care Act provision took effect incurred about 15% more in health care costs than those who already were covered under their parents' plans, according to a study by the Employee Benefits Research Institute, The Hill's "Healthwatch" reports.

The study notes that the newly insured young adults were more likely to use their coverage for mental health, substance use disorder or pregnancy care, (Viebeck, "Healthwatch," The Hill, 4/11).

Under the Affordable Care Act, employers that offer insurance plans are required to allow workers to include their children on health plans up to age 26. According to Politico, about 3.1 million young adults nationwide have gained coverage under the provision, which went into full effect in 2011 (Smith, Politico, 4/12).

For the study, researchers examined insurance claims from 2010 and 2011 at one large U.S. employer to determine the effect of that ACA provision. The researchers compared insurance claims for nearly 700 young adults who enrolled in a parent's health plan in 2011, under the ACA provision, with about 13,000 young adults who already were covered under a parent's plan prior to the provision taking effect.

The study found that 60% of hospital claims for the newly enrolled young adults were for mental health, substance use disorder or pregnancy care, compared with just one-third of claims filed for young adults who were already receiving coverage under their parents' plans.

Further, the findings showed that mental health and substance use disorder care accounted for 42% of newly enrolled young adults' inpatient hospital visits. The study also showed that the group was nearly four times more likely to use their insurance for pregnancy-related care than those who were previously insured. Meanwhile, the majority of inpatient hospital claims for young adults who already were covered in 2011 were for miscellaneous problems ("Healthwatch," The Hill, 4/11).

As a result, the study found that the newly enrolled young adults incurred $2,866 in health care costs per person, on average, compared with a $2,472 per-person average for young adults who already were covered by their parents' plans (Radnofsky, "Washington Wire," Wall Street Journal, 4/11).

According to "Healthwatch," the figures could reflect the higher cost of treatment for conditions such as substance use disorders and pregnancy, compared with "miscellaneous" hospital visits ("Healthwatch," The Hill, 4/11). The company studied by EBRI noted that the cost incurred by the newly enrolled young adults added just 0.2% to their overall health care costs ("Washington Wire," Wall Street Journal, 4/11).