Oba­macare’s clue­less ‘kids’

Al­low­ing young adults to dodge in­sur­ance costs teaches ir­re­spon­si­ble be­hav­ior

The Washington Times Daily - - OPINION - By Bryan Rotella Bryan Rotella is the founder and CEO of Rotella Le­gal Group.

In “The Break­fast Club” a group of high school de­viants were asked to write an es­say in 1,000 words or less de­scrib­ing “who do you think you are?” There was the brain, the ath­lete, the bas­ket case, the princess, the crim­i­nal … you re­mem­ber.

“Kids” born in 1991, six years af­ter the Break­fast Club, are now turn­ing 26 and the same ques­tion should be asked: Who do they think they are? This year the an­swer for many will be: un­able to af­ford health in­sur­ance.

This group of mil­len­ni­als is the first gen­er­a­tion of Amer­i­cans to have spent the en­tirety of their adult­hood to date un­der the only uni­ver­sally pop­u­lar pro­vi­sion in the Pa­tient Pro­tec­tion and Af­ford­able Care Act (Oba­macare or ACA). They have had the ben­e­fit of ac­cess to health in­sur­ance “rent-free” on their par­ents’ cov­er­age up to age 26. This pro­vi­sion is so pop­u­lar that House Speaker Paul Ryan ac­tu­ally fa­vored keep­ing this pro­vi­sion in the now-failed Amer­i­can Health Care Act.

As their birthdays come and go, th­ese 26-year-olds are star­tled as they learn for the first time the true cost of health care. Their fi­nan­cial pain is pal­pa­ble — whether from the ex­plod­ing pre­mi­ums on Oba­macare’s ex­changes or in sig­nif­i­cant em­ployee con­tri­bu­tion de­duc­tions from their pay­checks. That is if they are lucky enough to work for a group with a health plan.

So how did age 26 be­come this magic, or for many now tragic, num­ber?

At the time of the ACA’s im­ple­men­ta­tion in 2010, roughly 30 per­cent of young adults up to age 26 had no health in­sur­ance at all. That was three times the rate of unin­sured chil­dren. While a whop­ping statis­tic, no­body ap­pears to have asked whether th­ese “kids” ac­tu­ally couldn’t get in­sur­ance, or just didn’t want to seek work in a less glam­orous role-up-your-sleeves type of job that pro­vides ben­e­fits. In­stead, as with other per­ceived prob­lems, the gov­ern­ment came up with a new “en­ti­tle­ment” so­lu­tion. Put the pain felt by younger adults from health care costs on lay­away and hide it un­der the se­cu­rity blan­ket of their par­ents’ cov­er­age.

But who has re­ally been the win­ner in de­lay­ing health in­sur­ance


Joe Cortelli, co­founder of na­tional health in­sur­ance bro­ker­age HIG and a cov­er­age ex­pert, knows.

“It’s the in­sur­ance car­ri­ers. They love hav­ing young adult ‘de­pen­dents’ of em­ploy­ees on em­ployer-of­fered plans as is helps weigh down the costs from their more ex­pen­sive higher-care-use con­sumer par­ents.”

And while this healthy low-risk pool has propped up the bot­tom lines of cer­tain in­sur­ance car­ri­ers, the law of un­in­tended con­se­quences has taken hold.

The age-26 pro­vi­sion has played an in­stru­men­tal role in de­flat­ing Oba­macare’s “get cov­ered or pay up” man­date model. “The pol­icy has proved to be a dou­ble-edged sword for the ACA’s on­line health ex­changes be­cause it has fun­neled young, healthy cus­tomers away from the over­all mar­ket­place ‘risk pool.’ In­sur­ers need those cus­tomers to bal­ance out the large num­bers of en­rollees with chronic ill­nesses who drive up in­sur­ers’ costs — and ul­ti­mately con­trib­ute to higher mar­ket­place pre­mi­ums.”

Doesn’t this sound sim­i­lar to an­other press­ing is­sue for mil­len­ni­als?

They have the du­bi­ous for­tune of hav­ing the largest stu­dent loan debt of any gen­er­a­tion of Amer­i­cans. To be ex­act, for the class of 2016, it is $37,172 on av­er­age per grad­u­ate. This mas­sive group of young adults has de­ferred the pain of debt pay­back by rid­ing on their par­ent’s “credit” with the gov­ern­ment’s full sup­port, ul­ti­mately ben­e­fit­ing big busi­ness.

More and more young peo­ple are head­ing to col­lege only to take jobs post-grad­u­a­tion that do not al­low them to make the min­i­mum pay­ments on their loans. Some 3,000 Amer­i­cans are de­fault­ing ev­ery day on their stu­dent loans. Even scarier, de­lay­ing the fi­nan­cial re­spon­si­bil­i­ties of adult­hood has led many of th­ese clue­less “kids,” in debt up to their eye­balls, to think noth­ing about us­ing bor­rowed high in­ter­est rate dol­lars for spring break ben­ders.

The par­al­lel to the na­tional drug abuse epi­demic is stark. Ac­cord­ing to the Na­tional In­sti­tute on Drug Abuse: “Young adults (age 18 to 25) are the big­gest abusers of pre­scrip­tion (Rx) opi­oid pain re­liev­ers, ADHD stim­u­lants, and anti-anx­i­ety drugs. They do it for all kinds of rea­sons, in­clud­ing to get high or be­cause they think Rx stim­u­lants will help them study bet­ter.”

Pre­scrip­tion drugs, for most of us, re­quire hav­ing some form of health in­sur­ance. Would th­ese “kids” feel dif­fer­ent about their ram­pant use of ad­dic­tive drugs if they had to pay out-of­pocket ear­lier for their health care, rather than count­ing on good old Mom and Dad un­til age 26?

So what do those of us ob­serv­ing all of this have to look for­ward to? Vice Prin­ci­pal Richard Ver­non from “The Break­fast Club” said it best: “You think about this: Th­ese kids … when I get old — they’re go­ing to be run­ning the coun­try.”

At least we can hope it’s not the crim­i­nal.

The age-26 pro­vi­sion has played an in­stru­men­tal role in de­flat­ing Oba­macare’s “get cov­ered or pay up” man­date model.

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