As the Oct. 1 launch date for healthcare exchanges nears, the Obama administration is continuing to tout lower premiums and more coverage for all Americans. But a new report from the Government Accountability Office indicates the Affordable Care Act is going to be anything but affordable for Millennials.
The report details insurance premiums paid nationwide in 2013 and was conducted in response to a request from Sen. Orrin Hatch (R-Utah). Though the GAO’s findings could be altered based on a number of variables, one finding remained constant: rates are going to rise for young people.
As The Washington Examiner’s Philip Klein noted, a 30-year-old male with a yearly income of $35,000 would have to pay close to $3,000 to purchase the Affordable Care Act’s cheap “bronze plan.” That amount, Klein said, is more expensive than any state’s rates in the current system.
And though the Obama administration comforts wary citizens with the hope of subsidies, premiums for young people will still more than they are now,even after receiving those subsidies. Klein reports that a 30-year-old earning $25,000 in 2014 would have to pay $1,142 annually for the bronze plan — a rate more expensive than that currently paid in 45 states, as the GAO’s report shows.
In an effort to entice young people to purchase healthcare under the Affordable Care Act, the White House has engaged in a multi-million dollar marketing campaign, attempting to enlist the help of sports teams, singers and actors to promote it. Additionally, states operating their own exchanges are getting creative with ways to reach Millennials, purchasing advertisements on portable toilets and cell phone charging systems.
But in order for Obamacare to work and premiums for the elderly to remain at low costs, the administration needs to convince 2.7 million 18- to 35-year-olds to enroll in the exchanges. Even with rates holding steady at current levels, not enough young people are covered to subsidize coverage for those with pre-existing conditions — namely senior citizens.
“That means that the Obama administration has to convince nearly 3 million young and healthy Americans to purchase insurance by offering them drastically higher rates than the current market — the one from which they’re currently opting out,” Klein reported.
As the American Action Forum pointed out, as premiums rise, the more Millennials will choose to opt out of Obamacare and pay the fine instead. And in 2014, the penalty for foregoing insurance is just 1 percent of taxable income — $95.
The incentive for young Americans to purchase health insurance through the Affordable Care Act just isn’t there.
Additionally, Maine, Massachusetts, New Jersey and New York are currently the most expensive states in which young and healthy residents can buy health insurance. Consequently, these four states already have regulations similar to Obamacare enacted — with Massachusetts serving as a replica of the healthcare law at the state level.
And with further evidence from the GAO, it appears Obamacare’s architect, Sen. Max Baucus (D-Mont.) was right — the law is a train wreck, but especially for Millennials.