What can young people do for their country? Buy health insurance.
The exit of UnitedHealthcare from some state insurance exchanges and hints from other insurers of potential exits are largely linked to the absence of young people from the insurance pools. There simply are not enough healthy, low cost people to cover the expenses of older, sicker policyholders.
Insurers refer to them as the “young invincibles.”
“We saw very little of the young and healthy,” Sherri Huff, a consultant and former chief financial officer of Common Ground Healthcare Cooperative in Wisconsin, said in an interview with Modern Healthcare.
Unlike most other insurance co-ops that were started with federal loans from the PPACA, Common Ground is still in operation. Most others folded after claims exceeded premiums.
Young people not bothering to buy insurance is not surprising. It’s the reason the insurance coverage mandate is considered an integral part of the PPACA.
But so far the mandate and the associated tax penalty levied on those who fail to acquire coverage have not had the anticipated effect. The Obama administration upped the ante this year by raising the fine from $325 to $695, but so far it doesn’t appear to have been a game changer.
Of course, those who are subject to the increased penalty might not realize it until they file their 2016 taxes next year. So it might take a while for consumers who have previously believed they were saving big bucks by avoiding insurance to reassess their calculation.
It may not just be that young people believe themselves to be immune to danger and disease. There is likely a great deal of ignorance about how to acquire insurance as well as the generous subsidies available.
“For somebody who’s only making $40,000 trying to pay college debt or saving for a house, it’s a difficult proposition for them to consider buying insurance,” Dan Schuyler, an analyst with Leavitt Partners said to Deseret News. “We just haven’t done a satisfactory job of communicating to the young and healthy the reason why they need insurance.”