Popular ObamaCare provision hampering push for millennials

Popular ObamaCare provision hampering push for millennials
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One of the most popular pieces of ObamaCare could be hurting the administration’s push to attract more young people into the wobbly marketplace, according to several people who helped shape the law.

The administration is staging campus enrollment drives and pouring money into Facebook and Instagram ads this year in an attempt to boost ObamaCare enrollment among young adults. The sign-up period begins Tuesday.

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Yet there’s a fundamental flaw in the effort — and it has to do with ObamaCare’s design.

Because of the healthcare law, the White House says nearly 3 million young people under the age of 26 have been able to stay on their parents’ insurance plans and don’t have to shop for coverage on HealthCare.gov.

That’s about double the number of young people between the ages of 18 and 25 who are currently covered through the exchanges.

“I think that is an argument that has some validity,” John McDonough, a senior adviser to the Senate committee that wrote ObamaCare, said in an interview.

“If we didn't allow these kids to go on their parents’ plans, many of these kids would have gone to the exchange and would have created a more stable marketplace under the exchange,” said McDonough, who now teaches at Harvard University's T.H. Chan School of Public Health.

Recruiting young people is a central aim of the White House’s final sign-up drive this fall. It’s a particularly crucial task because insurers are panicking about the number of sick and older people enrolled in ObamaCare; some insurers have dropped out of the exchanges altogether.

The White House initially hoped adults under the age of 34 would make up 38 percent of the marketplace. Instead, that figure is about 28 percent in 2016, according to federal data.

Still, experts say lagging enrollment among young people is the result of many factors, including rising premiums. 

It’s also difficult to measure how many of the people under age 26 would have opted for ObamaCare, rather than a healthcare plan through their jobs, if they weren’t allowed to stay on their parents’ plans. 

But experts say at least some of those young people would have signed up for ObamaCare if not for the benefits extension under the law. 

Jonathan Gruber, who was a key voice during the drafting of the healthcare law, agreed that more young people would have been drawn to the marketplace without that provision.   

“If we didn't have the expansion to age 26, probably some healthier folks would have come into the exchanges,” he said in an email.

But in the end, he said, it wouldn’t be worth it. Leaving out the provision would have resulted in more uninsured people overall; people between the ages of 18 and 25 are more likely to be uninsured than any other age group.

Six years after the provision went into place, the uninsured rate for the under-25 population has plummeted. 

One study touted by federal health officials — the Gallup-Healthways Well-Being Index — found a 46.5 percent drop in the number of uninsured adults between the ages of 18 and 25 since the law was first enacted.

Just 13.9 percent of young people in that age range are now uninsured as of early 2016, an all-time low, according to the Gallup-Healthways data.

But that success has a downside for the Obama administration. Health insurers have been counting on younger, healthier people to sign up with ObamaCare to help defray costs of the older, sicker populations.  

Back in 2010, the Congressional Budget Office estimated the influx of young and healthy people into the exchanges would lower premiums by 7 to 10 percent.

Instead, the opposite has happened in some markets this year. A lack of young people, among other factors, has prompted premiums to rise an average of 22 percent across states in the federal marketplace.   

In its final sign-up push, the White House is directly targeting millennials. Health officials are running ads on Instagram, Facebook and YouTube and partnering with companies like Lyft. 

Several of President Obama’s speeches focused on the healthcare law have been delivered at colleges. His most recent speech took place at Miami Dade College, which boasts the largest undergraduate population in the country.

The White House has also launched the Healthy Campus Challenge, encouraging university and student leaders to host sign-up drives, send mass emails about deadlines and post messages through public social media accounts.    

But college enrollment campaigns are made tougher by the federal provision that allows young people to keep their parents’ coverage even after graduation. 

Joe Antos, a healthcare researcher at the conservative American Enterprise Institute, said the administration will have a tough job convincing students to switch from their parents’ plans. 

“If you want to get young healthy people to sign up on the exchanges, then don’t give them other options that are better,” Antos said.

“Signing up with your parents is clearly the better option for most younger people,” he said, noting that it’s largely a middle-class benefit. “It’s hard to beat that option for young people because it’s basically no effort, and for most of them, either no or very little money.”

The idea of allowing young people to stay on their parents’ plans first began spreading in the states a few years before ObamaCare. Before the law passed, about 20 states had already decided to extend the scope of what’s called “dependent health coverage.”

Several people involved with ObamaCare at the time — including Gruber and McDonough — said they didn’t know exactly how the policy became part of the law.

McDonough, who worked with the Senate Health Committee on the law, said the idea likely was a popular way to “provide some benefits and some good will for the law right away.” Unlike the marketplaces, which didn’t launch until 2013, the protection for young people went into effect immediately.

“Pretty much everybody on both sides of the aisle when it was raised said that makes sense, that's a good idea,” he said. 

Since the law’s passage, the idea has had near-universal support in Congress, even among Republicans. 

The House GOP’s healthcare plan, released with much fanfare in June, specifically says dependents up to age 26 could stay on their parents’ plan, “helping younger Americans receive health care and stabilizing the market.”