Remaining uninsured much cheaper for young people under Obamacare

Chris Bing Contributor
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Convincing young people to sign up for health insurance remains critical to keeping the Affordable Care Act program sustainable, yet a cost-benefit analysis for young applicants may help explain what is leading them to consistently turn down Obamacare.

Signing up for health insurance under Obamacare will be five times more expensive for healthy young people than remaining uninsured, according to a recent report from the financial analysis group NerdWallet.

“A young, healthy, insured individual will incur $1,717 in out-of-pocket health-care costs in 2014 — with the majority of these expenses relating to premium costs, not to direct health care expenses,” according to NerdWallet. This is presupposing the individual has no emergency visits during 2014.

A young person covered by the same coverage who visits the emergency room only once will incur an estimated cost of $2,791 — a $1,074 increase.

Among individuals between the ages of 18-34, less than 15 percent report an injury-related ER visit within any two-year period.

Consistent hospital visits are unlikely for these healthy young people.

“Fewer than 15 percent of young adults report [have] one of the following chronic conditions: arthritis, asthma, cancer, diabetes, heart disease, or hypertension,” the report reads. “Asthma is the most common, at 7.2 percent — the remaining conditions occur at a rate of less than 5 percent in young adults.”

If a young individual falls within this healthy majority, chooses to go on being uninsured and doesn’t visit the emergency room, the cost — even after suffering the 2014 mandated penalty — is only an estimated $348, according to the NerdWallet analysis, based on federal data.

The Obama administration’s original target of approximately 38 percent for youth enrollment, set before the program’s botched Oct. 1 rollout, was considered within a context where the White House believed that approximately 2.7 million of the forecasted seven million enrollees for 2014 would be young people.

In reality, only 24 percent of the 2.2 million applicants who signed up for coverage between Oct. 1 and Dec. 28 belong to the target audience of 18- to 34-year-olds, according to the first enrollment report recently released by the White House.

NerdWallet Health/Young Sign-up comparison cost report snapshot /2014

NerdWallet Health/Young Sign-up comparison cost report snapshot /2014

Tags : obamacare
Chris Bing