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Saturday, September 8, 2012

The Affordable Care Act: Helping the "Young Invincibles"

Just who are these “young invincibles”?  The term describes young adults between the ages of 18-29 who may seem uninterested in health insurance and believe they can afford to go without coverage— and are therefore, “invincible”. Unfortunately, this belief is false. Of course, not all young adults think they are invincible and none of them actually are. While this is a mostly healthy demographic, many of them desperately need health insurance to obtain necessary health care, and many more of them know that they should have it in case of emergency.  In addition, the parents of many of these young adults are keenly aware that if their son or daughter experiences a significant medical need, it is they who will be paying for it, one way or another. These parents want coverage for their child, even if it is not a priority for the young adult.  If given the chance to have affordable health insurance, many young adults leap at the opportunity. And thanks to the Affordable Care Act (ACA), as of November 2011, 13.7 million young adults aged 19-25  did just that, by either staying on their parents’ health insurance or rejoining it. 

These not-so-invincible young invincibles often struggle with obtaining, navigating, and affording health insurance. The uninsured rate among this group in 2009 was 14.8 million, an increase of 4 million from the past decade. This group is a large part of the 50 million people in 2010 living in the United States without health insurance and the ACA addresses their coverage directly. The dependent coverage provision encompassed in this law permits young adults under the age of 26 to remain on their parents’ private health insurance plan, even if the adult child lives in a different house in a different state, or even if the child is married. This policy went into effect on September 23, 2010; six months after President Obama signed the ACA into law. Since then, millions of young adults have gained or retained health insurance through their parents.

But young people must confront more than misconceptions about their own mortality—there are other reasons this group lacks health insurance. One unfortunate practice that serves as a barrier for young women’s access to health care is the practice of gender rating. Women are routinely charged more than double the premium compared to the amount men pay for the same health insurance coverage. This existing practice causes young adult women to delay getting needed health care because of the cost. Some states banned this practice, but in states where gender rating is not prohibited, 95% of bestselling health insurance plans charge women more for the same exact plan. The ACA makes it against the law in 2014 in all states for health insurance companies to charge women higher premiums solely based on gender. This provision reflects the ACA’s mission to make quality health insurance accessible and affordable.

Another reason this group often lacks coverage is simply the high cost of insurance. A national survey reported 40% of young adults had outstanding medical bills and were in medical debt. Often falling through the cracks of our healthcare system, there are many uninsured young adults in this country who lack reliable, affordable access to basic medical care. This is also a group that is likely to just be starting out in their careers, and making difficult choices about whether to pay for health insurance or rent. Luckily the ACA provides a new category of Medicaid eligibility for single, childless adults who have a household income at or below the 133% Federal Poverty Level (FPL) — or about $14,800 annual income for a single individual.  Currently, the eligibility criteria for Medicaid excludes low-income young adults from Medicaid if they do not have a disability or a child, thus leaving many young adults uninsured. For example, a 19-year-old who has just lost their AllKids insurance—Illinois public health insurance for children—may likely join the uninsured population. Under this ACA provision, however, the Medicaid program will change its eligibility criteria in 2014 to include single, childless adults.

Changing the Medicaid eligibility will finally allow many low-income young adults to receive much needed health care. Individuals who will be insured in 2014 because of the Medicaid changes will be called the newly eligibles, and the cost of their care is covered at 100% by federal funding until 2020, and after that, it will be covered at least at 90%.  This provision has the potential of covering 429,300 residents in Illinois.

While many young adults will be newly eligible for Medicaid or eligible to remain on their parent’s insurance, not everyone will be. For young adults for whom neither Medicaid nor the dependant coverage provision is available, there is an alternative of signing up to buy health insurance from their state’s Exchange in 2014.  An Exchange is an online site that will offer many comprehensive health insurance plans. It will allow the consumer to shop and compare plans so that they can ultimately find the one that best suits their needs and budget. Through the Exchange, there will be a variety of private health insurance plans available in a central online location that is both easy to navigate and written in plain English to allow for full transparency. There will also be financial assistance in the form of subsidies and tax credits available for those who qualify. The financial assistance will be available for individuals who make an income of up to 400% of the FPL – that’s a monthly income of $3,723 for a young single person.  An Exchange can be created by the state, the federal government, or in collaboration by both state and federal governments to offer quality and affordable health plans. Through the Exchanges, young people will have affordable and quality health insurance options to choose from.

Given the benefits and protection that it provides to young adults, we can see that the Affordable Care Act is working to help them access affordable and quality healthcare. By 2014 when the Exchanges are launched, the Medicaid expansion is in place, and all the other provisions are fully implemented, many more young adults will be able to take care of their health easily, affordably and efficiently. Unfortunately none of us are invincible, but the Affordable Care Act is a great tool in helping young adults (and everyone else) control their own healthcare.

Andrea Kovach, Staff Attorney 
Viviane Clement, Healthy Futures Vista
Sargent Shriver National Center on Poverty Law

(This post originally appeared in the Shriver Brief on August 31, 2012)


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