Morning Bell: Can Obamacare Get the Young Blood It Needs to Live?
by Alyene Senger and Amy Payne, Heritage Foundation, July 26, 2013
What would it take to get you to enroll in Obamacare? A folksy song? A celebrity endorsement? An ad in a porta-potty?
Taxpayer money may be used for all of those things and more as October 1—the date when the health insurance exchanges are supposed to open—approaches.
But all the campaigns and millions of dollars in advertising may not be enough, especially for the demographic Obamacare so desperately needs: young people.
Why Obamacare NEEDS Young People
The Obama Administration estimates that of the projected 7 million exchange enrollees next year, 2.7 million need to be young adults to make the premiums work. If young people don’t show up for Obamacare, premiums for everyone else in the exchanges will skyrocket—which, of course, dramatically increases the cost for taxpayers.
As Heritage has pointed out, Obamacare’s additional health benefits are not free: You will pay for them through higher premiums or lower wages. As employers’ share of health care costs rises, workers’ wages decrease. The added costs will be passed on one way or another.
Young adults are hit with increased costs from health benefits they must purchase but may not use. And they have the added disadvantage of paying artificially higher premiums because Obamacare’s rules make them do so. This Obamacare rule, called community rating, charges younger, healthier people to help offset the higher costs of insuring older and sicker people. In addition, the “guaranteed issue” rule lets you wait until you’re sick to buy coverage and doesn’t allow insurers to charge you more for procrastinating—giving healthier people an incentive to jump in only when they need care.
Why Obamacare’s Logic Falls Apart
So Obamacare needs young people to enroll to help everyone’s premium costs. But will they?
This week, CNN asked its intern, a college senior, what she’s likely to do when she’s forced by the law to buy health coverage.
“Will you buy health insurance under Obamacare, and are your friends interested in doing that?” the anchor asked. The intern responded, “Well I must say, as influential as [singer] Alicia Keys is, I must say, my bank account is not on fire, so I would probably pass on paying for health insurance because the fine would be cheaper for me.”
That’s right—the fine for not buying health coverage will likely be lower for many than the price of the coverage. She’s just doing the math. It is likely that many rational individuals will have this response when they look at their bank accounts and then at Obamacare’s expensive coverage.
This is just another of the many reasons Obamacare fails the common-sense test. Congress shouldn’t throw any of our tax dollars after this debacle.
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