Health Reform Should Provide Insurance to Many Young Adults

FRIDAY May 21, 2010 -- Most of the 13.7 million younger Americans who currently lack health insurance could gain coverage under the health reform package signed into law by President Barack Obama in March, a new report from The Commonwealth Fund says.

Starting in September, many uninsured young adults up to 26 years of age will be eligible to remain on their parents' insurance plans, as the initial provisions of the Affordable Care Act start to take effect, the report noted.

"We have entered into a new era in American health care," Cathy Schoen, the Commonwealth Fund's senior vice president for research and evaluation, said during a Thursday teleconference to discuss the report, Rite of Passage: Young Adults and the Affordable Care Act of 2010.

When the law is fully enacted in 2014, an estimated 32 million Americans who currently lack health insurance will have access to coverage, Schoen said. "And," she added, "millions of under-insured will be protected against high medical costs and debt, and access to care will improve."

Since 2003, the Commonwealth Fund -- a private foundation that seeks to promote high-quality health care for all -- has issued an annual report on trends in health insurance among young adults 19 to 29, Sara Collins, the Commonwealth Fund's vice president for affordable health insurance, said during the teleconference.

"Every year the results have shown increasing numbers of young adults who are uninsured for all or part of the year and have ended up skipping medical care or struggling with medical debt," Collins said.

In 2008, an estimated 13.7 million young adults were without health insurance, which is about 30 percent of all uninsured people under 65, Collins said. And in 2009, 76 percent of uninsured younger adults did not get needed health care because of cost, she said.

Forty-six percent of uninsured younger adults with a chronic health condition said their health had gotten worse as a result of not getting care, according to the report.

Many insured and uninsured younger adults had medical debts and about half had asked their parents for financial help. Also, many had to drop out of school and fall behind on other debts like school loans, Collins said.

Collins explained that, in the recent past, many young adults lost their insurance coverage when they "aged out" of their parents' policies after graduating from high school or college. And, lower-income children lost Medicaid and the Children's Health Insurance when they turned 19.

"The Affordable Care Act is in many ways a graduation gift to many young adults, bringing sweeping change to their health insurance coverage over the next two years," Collins said.

Annual premiums for younger adults are expected to average about $3,300, and if these costs are spread across all family insurance policies then premiums are expected to rise less than 1 percent by 2011, Collins said.

In addition, young adults who buy their own insurance will benefit from reforms in the new law that ban lifetime limits on benefits and prevent health insurers from canceling coverage if a person gets sick, she said.

In 2014, there will be a substantial expansion of Medicaid, making it available to nearly everyone at or near the poverty level, Collins said. The expansion is particularly important because 52 percent of uninsured young adults are from families with incomes that will make them eligible for Medicaid under the new law, according to the report.

"The benefits to young adults of the Affordable Care Act cannot be understated," Collins said. "The reforms will not only make coverage more affordable, but also more comprehensive and secure, allowing young adults to start families and pursue careers without worrying about losing their health insurance or falling into medical debt," she said.

Dr. Judy Schaechter, an associate professor of pediatrics at the University of Miami Miller School of Medicine, called the Affordable Care Act an important step in expanding access to health care for young adults.

"I am thrilled because it addresses our patient population in transition," she said. When they lose their Medicaid or SCHIP [State Children's Health Insurance Program] coverage they "fall off the cliff," she said.

Schaechter said it's common for former patients who lose their insurance to contact her, looking for care. "The most painful is [when] it happens for kids with complex health care needs -- children with heart defects and bad asthma -- and they have nothing," she said.

But not everyone thinks the Affordable Care Act solves the problem of access to care and affordable health insurance.

Dr. Don McCanne, a senior health policy fellow at Physicians for a National Health Program, said that "although the Affordable Care Act uses various programs to expand coverage for young adults, it is a disappointment because it fails to accomplish two of the most important goals of reform."

McCanne's preference would be a single-payer, government-administered program that, he said, would offer equitable coverage to all Americans.

A fragmented system of private plans and public programs, such as those in the Affordable Care Act, is the most expensive model of reform, and it falls short of universality and equity, he said.

"The single-payer model, on the other hand, is the least-expensive model of comprehensive reform, and it automatically enrolls everyone, while containing costs through proven, government-administered single-payer policies. It is equitably financed through the tax system based on the ability to pay, so it is affordable to everyone," he said.

More information

To read the full report, visit the Commonwealth Fund.

Posted: May 2010


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