College-aged students rapidly gaining health care coverage
Young adults 18–25 are gaining health care coverage through their parents’ plans faster than expected. Since this requirement of President Obama’s Affordable Health Care Act (“Obamacare”) took effect a year ago, they are no longer the most uninsured age group. Analysis shows that 18–24 year olds have pulled ahead of their 25–34 year old counterparts, dipping down from 29 percent uninsured to 27.2 percent by one report, 24.2 percent by another.
A New York Times article last month reported on three new surveys showing that 502,000 more 18 to 25 year olds gained health coverage this way by the end of 2010, increasing to 900,000 in the first quarter of 2011.
Ben King, a PSU communication major, thinks this provision is “awesome,” and he plans to take full advantage of it until age 26. King’s parents found a way to keep him covered when he was out of school before the new law kicked in. The Obamacare law “gave my parents more freedom.”
Jake Fagan, multimedia director at KPSU Radio, is also taking advantage of this provision. Fagan is nervous about becoming uninsured next year when he turns 26.
Charlotte Heard, a 26-year-old accounting major, fell through the cracks. When her mother lost her job, Heard became uninsured at age 24. Now she’s 26 and ineligible for the new provision.
Is health insurance really important when you’re young? “The hope is it will keep you healthy; you won’t forgo treatment now and have a worse [health] state later,” said Neal Wallace, an associate professor in PSU’s Hatfield School of Government who teaches health policy and health economics. “Insurance is really important for things you don’t know are going on, such as high blood pressure and pre-diabetic conditions.”
Another age group contentedly amongst the insured with a 2–3 percent uninsured rate is the 65 and older group. These are retired folks who have a government-sponsored health insurance program medicare.
This begs a question: If these two age sectors are doing better—wonderfully, even—at getting coverage, should government-sponsored health coverage be extended to all age groups?
“Of course,” says Heard. “I wish we had it. And more Medicaid for the poor.”
“We already have national health care; it’s called the emergency room,” said Wallace. People who go without insurance and avoid the doctor for years often show up in emergency rooms during a crisis. However, many experts have pointed out that, ultimately, all insured Americans pay for the uninsured through higher premiums due to extra emergency room treatment.
Wallace also pointed out that there are many other forms of government-sponsored health care already. There are subsidies for workers because businesses take tax deductions for their health care premiums, up to $200 billion a year.
What would happen if the Obamacare plan was repealed by Congress or invalidated by the Supreme Court?
“Clearly these coverage gains would go away,” Wallace said. “We’d be back to where we were. It wouldn’t wipe out everything, [but] it would be a lost opportunity.”
And what is going to happen if Obamacare kicks into full gear in 2014? Yes, people will be required to buy insurance, but major government contributions will be coming down the pike for citizens who earn up to 400 percent of the poverty level—that’s $43,000 a year for an individual and $88,000 a year for a family or four.
The government will pay 2–9.5 percent of the annual salary of folks in this income bracket to cover
insurance premiums.
Additionally, the government will pay 70–94 percent of the deductibles and co-pays for this group to their insurers, a big reduction from current figures. For young people, there will be basic “catastrophic” plans for the “young invincibles,” young adults who forgo health care because of the perceived low risk of needing it. There will be a system of state-based “affordable exchanges” to shop for health plans.
Anyone with pre-existing medical conditions will never have to worry again about being covered—insurance plans will have to cover them. There will be no lifetime limits on coverage, Medicaid for the poor will expand, and many other improvements will happen.
According to Wallace, many activities not seen for decades will resurface. “The game…of going in and out of the system stops,” he said.
The game of people buying insurance only when sick, and insurers “cherry-picking” the healthiest customers and excluding others will end. A framework to improve cost and efficiency will be in place. “The energy,” Wallace says, “will go to cost-controlled, effective care and coverage.”
