“Unexpectedly,” student health care plans will be more expensive under ObamaCare

Many of the forty million (give or take) uninsured people are young, and many young people (upwards of forty percent) lack health insurance.  Old folks gripe that young people do not insure themselves because they think they are invincible.  That may be true for some portion of the population, but a lot of young people don’t get insurance because they either cannot afford insurance (see, youth unemployment rate, student loan debt, etc.) or because they cannot afford to subsidise the middle-aged people who are complaining about the youth’s lack of responsibility.

Here in Massachusetts, even the most basic state-approved health care plan costs around $3,000 a year for a young person.  I’m here to tell you that young people don’t use an average of three grand (plus deductibles and co-pays) of health care per year.  The reason for the high premiums? Community rating means that young people cannot be charged less than 1/3d (under ObamaCare) of what older people are charged.   Older people cost approximately six times as much, but can only be charged three times as much.  How to make the math work (both on the multiplier and on the discount to the middle-aged)?  Charge young people far too much.

We (myself, health care policy analysts, various wonks) have been saying this for months.  Years.  So when CNN comes out with an article on how even student health care premiums will increase by a thousand to two thousand dollars per year, we’re not surprised.

Students are already struggling under absurd debt loads.  Why are we adding another four thousand dollars to the cost of attending college? Why are we asking young people to funnel their extraordinarily limited funds towards platinum health care plans that they will rarely use and may not want?  Why are young people – who will not have Social Security and Medicare, despite paying into those programmes, who have student loan debt, who will struggle to have the same standard of living as their parents – subsidising middle-aged people with more wealth and more structural advantages?

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Filed under Economics, ObamaCare

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