Young Adults and Obamacare

We've all heard our fill about Obamacare, but because it is so complex most of us don't have a clue what's going to happen as its implementation kicks into gear next year. That's beginning to change as all kinds of research is being done and reports on the results of that research starts to hit the news.

Earlier this week we saw plenty of coverage of the Rand Corporation's analysis of the 14 states that have opted not to implement the Medicaid expansions called for in Obamacare, and the projections aren't good for those states which include North Carolina. Now comes this fascinating interview with the executive director of Young Invincibles, a group that studies young adults' role in health reform. The interview is about how young adults view health insurance and the likelihood that they will opt in to Obamacare, which everyone seems to agree is a critical factor in the success of the program. Here are the most interesting tidbits:

About 19 million young adults 18 to 34 lack health insurance. Our polling shows that less than 5 percent of young people choose not to have it. The number one reason they don’t have it is the cost. Most young people don’t qualify for Medicaid right now even if they have very low incomes because most states just don’t give childless adults Medicaid. That’s one of the biggest changes under Obamacare. If every state expanded Medicaid, about 8 million would qualify for Medicaid. Another 9 million would qualify for subsidies because they make less than 400 percent of poverty.

So then 17 of the 19 million uninsured young people are, in theory, eligible for either subsidies or Medicaid under Obamacare?

That’s right. It’s a pretty phenomenal percentage. So if we do our jobs right, young people will be one of the biggest winners in the health-care law…

 But the cost does matter. So is Obamacare actually going to make insurance affordable for this group? Or will it make insurance more expensive for young, healthy people by making it easier for sicker, older people to buy insurance without getting discriminated against? 

The first important point is the huge percentage of unemployed young people who get access to either subsidies or Medicaid. So you saw in California that many young people will end up having insurance options that cost them less than $100 or less than $50 simply because their income is low enough to qualify for subsidies. For someone making $20,000 a year, they’re going to have to pay $40 a month for health insurance. That’s a very good deal. And in a state like California, there are also millions of young people who qualify for Medicaid.

Now we’ve identified a population between 300 percent and 400 percent of the federal poverty level that’s going to have more problems. The subsidies aren’t that rich for them, and so whether to buy is a tougher question. They’ll have financial strain. They have financial strain now. That’s why they’re uninsured. If you’re just getting by, then $200 a month can be a lot. That’s where education can be key. It can still make good financial sense to be covered because there are real risks. But I think, in general, it will be a good enough deal to sign up. We saw that in Massachusetts where youth uninsurance dropped in half in the first year…

So given all the issues of implementation and the political opposition to the law and the difficulties in various states and the early information about premiums, where do you think this will end up in 2014 and 2015? Do you think young people will sign up or stay away?

I’m pretty hopeful, in part because the experience in Massachusetts showed this model can work. But it will play out differently in different states. A state like California is following the playbook. They’ll do a big promotional campaign. They’re investing in on-the-ground outreach and education. They’re expanding Medicaid so really low-income folks will qualify for health insurance. So I could see it being a huge success in a state like that. But not every state will do that. An important point for young people is that some of the states with the highest rates of youth uninsurance are in the south and some of those states aren’t expanding Medicaid or building their own exchanges. My fear is what happens in those states. So I could see some states coming out and looking much better than other states.

As a father of three children a couple of years away from entering the working world and as a resident of North Carolina, one of those southern states not "following the playbook", that last paragraph truly worries me.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s