Here’s the gigantic hole in Obamacare: it relies on young, healthy people, called “young invincibles,” to pick up the heavy costs of older people’s healthcare, and for many young, healthy people, it just isn’t worth it.
New figures reveal that in the six states keeping record of what percentage of young people are enrolling in Obamacare, only 28% of those aged 18-34 are enrolling, far short of the 40% needed for Obamacare to succeed.
Even though the federal government will fine those who don’t have health insurance by March 31, 2014, “young invincibles” are turning away from enrolling. The $100 to $200 a month that young people would spend on health insurance is more than they want to pay, with expenses such as food, rent, car payments, and auto insurance.
Living without health insurance for the young does make some sense; Carl Schramm, a former insurance company executive said that statistics show the average uninsured male will only see a doctor six times in the fourteen years between age 21 and age 35. Even his insured alter ego, according to healthcare consultant company Milliman, will see his doctor less than twice a year between the ages of 21 and 34. Insured women in that age group will see their doctors 3.6 times a year on the average.
Economist Douglas Holtz-Eakin, former head of the Congressional Budget Office, said of the “young invincibles”:
Most of them have zero health costs. In fact, the median health care spending for this group is exactly zero. Literally if they do the arithmetic, 80-85 percent will just say no … pay the penalty and stay out of the Affordable Care Act. There’s a long tradition of the young invincibles not buying insurance. Those who did buy insurance in polling that we’ve looked at said that if their premiums went up as much as 30 percent, they’d drop it.
He added that if the health insurance offered through Obamacare is too exorbitant for the young age group, the rest of the population will get hit with the burden. He said, “If the age group doesn’t sign up at all then the so-called exchanges are filled with very high-costs patients and the government will have to subsidize them extensively. We’ll end up with a government run program for very sick people, something we’ve already had.”