The Unconquered

 /  Dec. 2, 2013, 10:43 a.m.


Anna StapletonInvincible: that which cannot be conquered in combat or war. It is a title bestowed upon warrior heroes of old, but in the realm of health insurance, being dubbed a “young invincible” is not so much an honor as it is a term of derision. The epithet is typically applied to individuals under thirty-five years old who are uninsured, and presumed to be too young, carefree, and heedless to bother getting insurance. Because of the mechanics of Obamacare, the entry of young people into the health insurance market is necessary for the survival of affordable insurance plans. Winning over the young invincibles has, therefore, become a core goal of the health law’s champions, as well as its opponents. At the same time, there is reason to believe that the young may not feel as invincible as they are commonly assumed to be. In failing to recognize this more complex truth, both sides risk alienating the very constituency they seek to win over.

Why a battle for the young? If too small a proportion of insurance customers are healthy, it becomes difficult for insurers to cover the costs of care for the sick, forcing them to raise premiums for everyone. Doing so further reduces the incentive for healthy people to buy insurance and leads to what is called a “death spiral,” in which insurance eventually becomes too expensive to attract anyone, but those who are sick enough to need it and affluent enough to afford it. Because young people (especially young men) tend to be healthier and require less care than older adults, ensuring that a lot of young people purchase coverage helps keep prices from spiraling out of control.

For supporters of Obamacare, this means that convincing young people to purchase insurance is key. For opponents, encouraging the young to stay out of the Marketplaces has become a strategy to derail the project. The high stakes have inspired both sides to employ some fairly desperate tactics: While one pro-Obamacare ad features bros doing keg-stands, an opposition group created videos of a truly terrifying Uncle Sam performing gynecological exams.

However, the most creative cajoling is likely to have only weak influence. The more important factor is this: Do young people want health insurance to begin with?

Popular wisdom contends that the answer to this question is no. Evidence typically cited states that in the United States, people under the age of thirty-five are disproportionately uninsured. According to the Census Bureau, in 2012 the proportion of individuals under age sixty-five who lacked insurance was around 17 percent; for those aged nineteen to thirty-four, it was 27 percent. While some might interpret that gap as evidence of youthful indifference towards insurance, an alternative theory holds that it reflects a lack of affordable options. A study conducted by the Young Invincibles (YI), an advocacy organization with a tongue-in-cheek name, found that among uninsured respondents aged eighteen to thirty-four, just 17 percent said they chose not to have coverage. That means that of the total population under thirty-five, only about 5 percent said they just don’t want insurance, begging the question—why are so many of them uninsured?

The answer is complicated: Of the uninsured aged eighteen to thirty-four surveyed by YI, 52 percent said they could not afford insurance, 4 percent were refused coverage, 15 percent stated that their employer did not offer insurance, and 12 percent did not name a specific reason. These last two groups remain something of a mystery. Are they unaware of individual market options? Or did they find the options not worth the cost?

As for the majority, who claimed affordability as their barrier to insurance, their enrollment will hinge on whether Obamacare provides them with more affordable options than they were previously offered.

Prior to Obamacare, young people could purchase dirt-cheap, low-coverage plans, often called “catastrophic” coverage. These plans protected against only the most expensive medical disasters, making them attractive options for young people with few pressing healthcare needs. Because Obamacare requires every plan to provide a certain minimum level of coverage, these plans no longer exist. Furthermore, while insurance premiums are still adjusted based on age (meaning the same plan has a lower premium for younger persons), new rules forbid premiums for the eldest to be more than three times that of the youngest. All told, for a young, healthy man, the lowest sticker price is likely to be significantly higher than the old “catastrophic” option, raising doubts as to whether young people who already considered insurance unaffordable will change their minds.

However, Marketplace plans come with some pluses: government subsidies for low-income individuals. A low-income person who found a $40 monthly premium for “catastrophic” coverage unaffordable might now get much better coverage for much less by using subsidies to reduce monthly premiums. Even so, exactly where that line of “affordability” is drawn will differ for each individual. In order for any individual to discover whether a plan they consider affordable exists, they must be wiling to take the time to check out the new system, a process made more difficult by the technical woes of the federal Marketplace website.

All together, the evidence presented by the YI poll refutes the theory that the young and uninsured don’t care about coverage. What emerges is a complex set of motives revolving around questions of cost. Exactly how those motives play out in the decisions young people make about purchasing plans remains to be seen, but it is certain to be a key factor in determining the survival of the Marketplaces. In designing their appeals to those under thirty-five, warriors on both sides of the Obamacare battle would do well to remember that not all those who are young feel invincible, and the complex range of attitudes and concerns young people hold towards insurance may well prove difficult to conquer.

Anna Stapleton


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