Young people likely to dodge Obamacare
Young Americans may have been among the biggest supporters of Obamacare, but they may also be the least likely to comply with the law.Since there is no penalty for existing conditions, if they get sick they just buy insurance then, and avoid subsidizing the insurance of older and less healthy people. What I can't figure out is why Obama and Democrats still have any support from the young who are getting screwed by Obamacare.
The architects of health reform say the law will make insurance more affordable and widely available. But in 2014, benefits experts say, the cheapest option for 20-somethings will be to pay the penalty for not buying health insurance, rather than paying for any health insurance at all—that is, provided they don’t get sick.
And as more young people do the math, more seem to be deciding the Affordable Care Act isn’t such a good deal for them: Support for a national health-care plan dropped nearly 11% among American college freshmen between 2008 to 2012, with under 63% in favor of it today, down from 70%, according to UCLA’s annual student survey.
Next year, uninsured Americans must pay a penalty of $95, or 1% of their annual salary if they make more than $9,500 for the year. A person earning $50,000, for example, would pay a $500 penalty if they chose not to enroll in a health insurance plan.
But for a healthy 20-something who rarely goes to the doctor and doesn’t take prescription medications, that penalty might be far less expensive than buying a health plan through the state health exchanges, the new insurance marketplaces opening Oct. 1. Those exchanges, which will offer health coverage to people who can’t get it through their employer or by staying on their parents’ insurance, are just beginning to announce how much their plans will cost. But based on the rates released so far, the price of health insurance for a 20-something will start at about $72 a month in Washington, D.C., and $117 a month in California, for minimal coverage known as a “catastrophic plan,” available to people under 30.
That means that for someone making less than $86,400 in Washington, D.C., or less than $140,400 in California, even the cheapest health insurance would still cost more than the penalty (a 1% penalty on an $80,000 salary, for instance, would be $800, while the lowest-price insurance in Washington would cost $864 a year and in California, $1,404).
And the bare-bones plans also have high deductibles, so 20-somethings in the least expensive Washington plan would still have to pay $6,350 in medical bills before the insurance company would start to pick up the tab—a calculation that could lead more young people to see the penalty as a comparative bargain: “The concern is,How many of them will even forgo that plan and just take the penalty?” says Caroline Pearson, a vice president at Avalere Health, a health-care advisory firm.“That’s what were waiting to see.”