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  • Democrats' Health Care Plans Come at High Cost to the Young

    Extending health care to the uninsured and those who can’t get coverage for pre-existing conditions is the epicenter of Democrats’ health care bills, but achieving that goal requires adding younger, healthier Americans to insurance pools to hold down costs. And achieving coverage for sicker populations comes at a significant price to young Americans, according to a recent report by Rea Hederman and Paul Winfree of Heritage’s Center for Data Analysis.

    Two provisions in the bills ensure that those with pre-existing conditions will be able to get coverage at an affordable cost.  ”Guaranteed issue” requires that insurance companies provide coverage to anyone, regardless of their medical history, and age rating would entail insurance companies charging older or sick customers no more than twice as much (three times as much in Senate bill) as they charge younger enrollees. This guarantees that premiums for the young will increase to subsidize the cost of covering the older and more sickly population.

    Increased premiums would inevitably discourage more youth, not less, from purchasing insurance. In order to counter this effect, the bills include provisions to ensure that younger Americans still join the risk pool: an individual mandate to purchase insurance and subsidies to purchase insurance for low and middle-income singles and families.

    But, according to Hederman and Winfree, “Unfortunately, trying to fix one flawed policy (the rating restrictions and guaranteed issue requirements) by adding another flawed policy (the mandate and costly subsidies) only makes the policy outcome even worse.”

    CDA’s findings echo predictions from the Congressional Budget Office that premiums in the non-group market will increase as a result of the bills. CDA shows these premiums increasing 10 to 13 percent. Rather than encouraging younger Americans to purchase insurance, this will achieve the opposite, thereby increasing premiums for the older and sicker population who must purchase insurance as younger Americans leave the market.

    The individual mandate is intended to force youth into the market, but further CDA analysis shows that this will not occur. Instead, most youth will opt out, largely because of the higher premiums that would result from the guaranteed issue and age rating provisions, but also because the penalty for not purchasing insurance would be significantly lower than premiums.

    For those to whom the individual mandate will apply and who are eligible for the health exchange, CDA predicts only 12 percent of single uninsured individuals under 35 will purchase insurance. Only 20 percent of families in the same category would bcome insured, and of the uninsured that don’t qualify for subsidies in the exchange, only 5 percent are expected to buy insurance. Altogether, CDA finds that greater than 93 percent of insured households would sooner pay the penalty and than purchase insurance at higher premiums.

    As Hederman and Winfree explain, “this quickly becomes a downward cycle as insurance costs increase, which will drive out more and more of those who are less costly to insure. Insurers will have no choice but to raise premiums, as they face paying out far more in benefits to cover a sicker pool…”  Clearly, the consequences of Obamacare are disadvantageous for everyone.

    Posted in Obamacare [slideshow_deploy]

    7 Responses to Democrats' Health Care Plans Come at High Cost to the Young

    1. Brett, Albany NY says:

      The Dems plan makes total sense:

      John Doe doesn't have health insurance because he really doesn't need it, and can't justify the high cost of the most reasonably priced health plan available in his state.

      Ok John, we're going to force you to buy insurance, as well as your neighbor Jane who has an astronomically expensive health condition. John's insurer jacks up his premiums to cover the huge costs of Jane. But don't worry John, we're going to take money out of your and Jane's pocket to subsidize the cost of both of your plans.

      Oh and John? ..rest assured we in the federal government have access to the secret world of unlimited doctors, hospitals, CAT scan machines and, so you'll never again be denied any medical treatment whatsoever–if you need it, trust us…you'll get it.

    2. Charlotte Beck says:

      Its not fair that I've paid for my insurance (with my employers help) all these years…and now my insurance will be higher than the young people's insurance because I'm older now. So – I've paid all along, and now I'm going to pay more to make sure those people in my town who do nothing but have babies and run drugs can have insurance. Isn't that special?

    3. Charlotte Beck says:

      I believe if you're too lazy or ignorant to get an education and work your way to make your own money….you don't deserve to be taken care of. It's amazing how my parents married (mom16 and dad18) off the farm and never took a dime from anyone and struggled their whole lives…and provided for me and my sister and made us work hard to get our educations, and jobs…just to work at jobs that sucked because there were benefits……to be told how sympathetic I should be to those who can barely speak English…..(and were born here)…and have not taken advantage of a FREE education. Sick of folks…. Wish I could get these folks to move out of this country…. We have become such a weak nation of do nothing people.

    4. Pingback: Democrats' Health Care for All Would Mean High Cost to Young | The … | Health Blog

    5. ChristineWithRegence says:

      In all the talk about health care reform, I don't feel like there's enough discussion about understanding the real costs of health care. Why don't we ever know the costs of health care procedures and treatments? I got a kick out of this fun, short video. Check it out. It makes you wonder why our health care system is set up the way it is.

    6. Barbara Frances Delo says:

      The burden to the next generation of this healthcare bill will be enormous – and that is unconscioncable.

      However, the fault is not in the democrats efforts to care for the truly needy. Rather, it lies in the high $ amounts targeted for bureaucracy and non-patient care jobs and the limits on co-pays that create an unsustainable financial burden. There is also an unprecedented level of government control over medical decisions. Finally, the bills encourage the downgrading of care.

      I believe protecting those with pre-existing conditions and long-term patients is a worthwhile goal in a just society. But it can be accomplished at a fraction of the cost by stripping away the bloated government bureaucracy, maintaing protection of life in our laws, and creating a targeted and modest program to meet this need.

    7. obamadrama says:

      How can Obama be serious about autism when he appoints someone like Ari Ne'eman as the spokesperson for autism? Ne'eman, like so many other eccentrics these days, is yet another example of the Donna Williams of the past who pretend to be autistic, but are really suffering from mental illness and other conditions that mimic autistic like features. The autism spectrum is so far out of control because the experts consulted about autism aren't experts. They don't live with autistic persons. A good video on YOU TUBE talks about the spectrum from a mom's view. She has a severe or perhaps profoundly autistic son. Her video on YOU TUBE is called "autism spectrum seems out of control." It certainly makes you question the entire spectrum disorder.

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