President Obama and Democrats in Congress are pushing hard to pass one of their versions of health care reform. The effect of this reform on health insurance premiums will be significant for young Americans. They could see their premiums double and they will face fines and even jail time if they refuse to pay these skyrocketing premiums. Sixty-six percent of voters in the age group of 18-to-29 year-olds voted for President Obama. How’s that hopey-changey thing working out?
A new study by Cato Adjunct Scholar Aaron Yelowitz concludes that the cost of President Obama’s health care plan would fall inordinately upon younger Americans, meaning they are in essence being asked to subsidize the care of their elders:
President Obama won the presidency with 66 percent of the vote among 18-to-29 year-olds. That’s a larger share than any presidential candidate has won in decades. Yet his health care overhaul could impose its greatest burdens on young adults, says Yelowitz.
Health care proposals moving through Congress would force most or all Americans to purchase health insurance (an “individual mandate”) and would impose price controls on health insurance (“community rating”) that would limit insurers’ ability to offer lower premiums to low-risk enrollees.
Those provisions would drive premiums down for 55-year-olds but would drive them up for 25-year-olds—who are then implicitly subsidizing older adults. According to the Urban Institute, many young people could see their premiums double, whereas premiums for older adults could be cut in half.
The entire Cato report is here in pdf format.