When history tells the story of the rollout of the health insurance Marketplace, one of the oddest vignettes will be about a tailgate party at a University of Miami football game hosted by a group called Generation Opportunity. This bash was complete with a DJ, balloons, beer, pizza and attractive young “hosts and hostesses” circulating through the crowd encouraging the partiers to forgo the opportunity to enroll for health insurance coverage. A civic organization discouraging what seems like responsible conduct seems odd. Most moms would find a measure of peace and comfort in having their young adults covered by health insurance. Plying young people with beer has a long tradition of inducing questionable behavior, often with lifelong consequences.
Of course Generation Opportunity would say the Marketplace is a bad deal for these young people. Furthermore, they believe that they can drive up the prices by keeping the numbers of young people enrolling down. Making the whole thing fail is what they hope to achieve.
But is the Marketplace really a bad deal for young people? The facts would suggest it can be a pretty good deal. Young people are seen as “good for the system” because they generally make fewer demands for health services. This is true enough, but ignores the need for protection from devastating downside risk. While most medical needs of young people are modest, they are more at risk for certain types of risks. Accidents, including automobiles crashes, are more likely to afflict this age group than their older neighbors. Medical cost associated with an accident can easily plunge a young person into bankruptcy.
The Affordable Care Act (ACA or “Obamacare”) offers a number of options for young adults. Since 2011, if a plan covers children, they can be added to or kept on a parent’s health insurance policy until they turn 26. These young people do not have to be financially dependent, students, or even live with their parents. They can be married and be covered. Like all applicants since Jan. 1, 2014, they cannot be turned down or charged more because of a pre-existing condition.
The other way the ACA provides coverage to young adults is through the Marketplace. This is where they are said to be at a disadvantage. Let’s look at real policies and costs available on the Marketplace in Allen County. Consider Miley, a hypothetical 22-year-old woman who lives in Iola and works at a coffee shop earning $12,000. Because of her modest income she will get a tax credit that will lower the amount of the premium she will have to pay. She will also get help to lower the deductibles. Miley can choose from 13 different “Silver” (70/30) plans from Blue Care Network and Coventry in Allen County. After her tax credit these policies will cost her from $20 to $31 each month. She also gets help with her co-pay and deductibles. If she chooses the least expensive Blue Care network policy she has a $250 deductible, pays $20 for a visit to the doctor and $15 for a generic prescription. It is hard to see how anyone is “taking advantage” of Miley.
Now let’s look at Bieber, 24, who just landed his dream job in Humboldt and makes $50,000 a year. Bieber doesn’t get near as much help. He will not get a tax credit nor will he get help with deductibles or co-pays. Because of this he isn’t limited to a Silver policy, which has the best subsidies. There are 36 policies from Blue Care Network and Coventry he can choose from. These range in price from $101 to $266 a month.
If Bieber selects the same policy as Miley, it will cost him $173 a month. He will have a $3,000 deductible, pay $30 for an office visit and $15 for a generic prescription.
Because Bieber is under 30 he has another option unavailable to older applicants, unless they can show a financial hardship. He can purchase a “catastrophic” policy on the Marketplace. The least expensive catastrophic policy is offered by Coventry and would cost him $102 a month. This is an option that specifically recognizes that young people generally have less need for health services and permits a policy with less coverage. This means that Bieber can save money on premiums and assume some of the risk himself. But instead of bankruptcy and financial ruin if a health disaster strikes, his losses are capped at $6,350 a year. Equally important, Bieber would be acting in a responsible way toward his community and neighbors, who would not be stuck with tens or hundreds of thousands of dollars of uncompensated care brought on by a major accident or other health crisis. Hopefully Bieber will never need it, but his mom will be glad to know he has the coverage.
Thrive Allen County offers assistance of trained Navigators to help residents of Allen County enroll in the health insurance Marketplace. Call 365-8128 for an appointment or drop in the Thrive office Wednesday evenings from 5 to 8 for assistance.
— John Robertson