INSURING YOUNG KEY TO HEALTHCARE OVERHAUL PLANS

November 30, 2009

Associated Press -

The young invincibles. That's what the insurance industry calls them. They're the 13.7 million Americans under 30 who don't have health insurance because, they firmly believe, they just don't need it. Why waste money on something they're too healthy to ever use?

In the debate over health care, lawmakers and industry agree that persuading this statistically healthy demographic to jump into the insurance pool would bring down costs for the broader population.

The United States is the only developed country that does not have a comprehensive national health care plan for all its citizens, and President Barack Obama has made overhauling health care his top domestic priority. But for young adults to make the leap and buy their own, health industry experts and youth advocacy groups say, Congress needs to focus more on affordability than invincibility.

In a country where most people receive health insurance from their employers, young adults are more likely than other age groups to work low-wage, entry-level jobs that don't offer insurance, according to the Kaiser Family Foundation. As a result, Americans aged 19 to 29 have the highest uninsured rate in the United States.

Insurance industry experts say it's important to bring young people like Mohring into the system because they're healthy and don't need costly medical care. Their premiums would help subsidize older, less healthy people in the insurance pool, thereby bringing down average costs.

That's one of the reasons why the health care bills circulating in Congress would require most Americans to get health insurance, or face a fine.

The plan is basically intended as a tax on young people to help lower the cost for others, said Martin Feldstein, a conservative economist who served as President Ronald Reagan's chief economic adviser.

"I think young people can accept the idea that it's OK for us to pay a little more now to, you know, make sure that the system works well in the long term," Smith said. "There will come a time when we are older, and we are sicker, and then the system will take care of us."

" Many of the health care overhaul provisions in Congress would affect young Americans, and a few were drafted specifically with that demographic in mind.

Young adults would be able to piggyback on a parent's insurance through age 26 in the proposed Senate bill, or age 27 in the House-passed bill. A recent study by the Commonwealth Fund suggests that raising the age of dependent coverage could insure more than 2 million young adults, albeit for a minimal hike in their parents monthly premium.

That would allow young Americans to start a business or be a photographer or writer, without being confined by having to find a job that has health care benefits, House Speaker Nancy Pelosi said when she announced her chamber's proposal in mid-October.

But the plan would leave out low-income young adults whose parents lack insurance themselves, said Karyn Schwartz, senior policy analyst at the Kaiser Family Foundation.

Of all the health care proposals circulating in Congress, experts say the one likely to cover the most uninsured young adults is a massive expansion of Medicaid, the federal-state health insurance program for the poor.

All the health care proposals would help ease the blow of an individual mandate by providing government subsidies to people who make less than 400 percent of the federal poverty level, or about $43,300 in 2009.

The subsidies could be used to buy insurance in newly created government-regulated marketplaces called exchanges. Shoppers on an exchange could choose from privately sold plans that meet new coverage requirements set by the government. A government-run insurance option also may be part of the final bill.

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