Millions of young Americans between the ages of 18 and 34 would be better off paying the penalty for opting out of Obamacare than actually buying into the program, according to a new report released Thursday by the National Center for Public Policy Research.
The report notes that about six million “young invincibles” – single, childless Millennials – who are eligible for the healthcare exchanges will be forced to pay at least $500 annually for insurance that they don’t necessarily need.
A healthcare exchange, as outlined in the Patient Protection and Affordable Care Act, is an online marketplace for purchasing insurance set up by the government. Because younger Americans tend to get sick less often than older ones, the Obama administration has pushed young Americans to join the exchanges to keep them viable, even going so far as to recruit – or attempt to recruit - professional athletes and Hollywood A-listers.
“Millions of single, childless adults will save at least $500 by forgoing insurance and paying the fine in 2014,” David Hogberg, Ph.D., a senior fellow for health care policy at the National Center for Public Policy Research said in a press release. “The problem is that to be viable the exchanges need these ‘young invincibles’ to participate.”
The fine for 2014 is $95 or 1 percent of the individual’s income, whichever is higher.
Moreover, there is even less of an incentive to buy insurance through the exchanges because of a rule known as “guaranteed issue.” According to the rule, if someone gets sick they only have to wait until the end of the year to buy insurance.
“Many of these people are already uninsured, meaning they find little value in insurance,” Hogburg stated. “Why are they going to pay $500 to $1,000 for exchange insurance when it’s cheaper to go without and they face much less risk if they don’t purchase it?”
The NCPPR isn’t the only organization of late to note the steep financial impact that Obamacare will have on young adults. A report issued by the Government Accountability Office last month confirmed that insurance costs are going to rise for Millennials under Obamacare. Even the liberal organization ThinkProgress inadvertently admitted that Millennials will get “hung” by the law.