President Barack Obama has a lot riding on whether “young invincibles” buy into health care insurance available under the Affordable Care Act.
Health care experts say these 20- and 30-somethings should weigh the economics of turning down the insurance and next year paying a $95 penalty, which rises annually, or becoming sick or injured without coverage.
Success of the marketplaces, which opened Tuesday, will hinge on the enrollment of millions of healthy young people nationwide to offset the medical costs of older, more chronically ill people.
The law requires that most people be covered, though parents can keep children up to age 26 on their plans.
Health economist Vivian Ho said young adults on their own probably won't forgo health insurance solely by comparing their costs to those of families, which might be lower.
The bigger hurdle will be convincing young healthy adults of the value of having insurance, no matter whether they think they need it, experts said. An individual's penalty for not buying insurance will jump to $325 in 2015 and $695 in 2016.
“You have to sell (insurance) to them as more of an economic decision around the unknown,” said Jennifer Kowalski, vice president of Avalere Health, a Washington, D.C.-based health care consulting firm. “You could be hit by a bus on your way to work. The message has to be around insurance and the value it has on peace of mind.”
Cost is an issue for Helena Gudger.
The 26-year-old Phoenix resident has gone the past four years without health insurance, using clinics and the county hospital for checkups, routine tests and visits to a gynecologist. She pays cash, checks prices and tries to go when doctors are offering discounts.
But she also is aware that she will be in a lurch if she gets sick. She does her best to avoid crowds where she could pick up an infection and even researches the local lake for outbreaks when her friends plan an outing. She wants to sign up for private health insurance, but cost is an issue.
Based on her income, Gudger will qualify for federal subsidies that will pay nearly half the premium for a midpoint “silver” plan, which covers 70 percent of costs and includes co-pays. An online calculator created by the Kaiser Family Foundation estimates her annual premium at $3,163 and the federal subsidy at $1,434, leaving her with a premium of $1,729, or $144 a month.
Even with the federal subsidies, that estimated cost is higher than what she'd hoped. And because she wants a decent insurance policy, not the bare-bones coverage cheaper plans offer, she's not sure how she'll proceed.
“If I was to be able to be offered affordable health insurance, I would say I would probably afford anywhere between $60 and $100 a month,” Gudger said in an interview before the exchanges opened. “I wouldn't want to pay more than $75, considering I'd have to pay for prescriptions and co-pays if I have to see a doctor.”
The U.S. Health and Human Services Department has said uninsured Texans will have an average of 54 plans from which to choose. Some counties might have more than others.
People living in the San Antonio area will pick coverage from 61 plan options offered by five providers: Humana Health Plan of Texas Inc., Blue Cross Blue Shield of Texas, Community First Health Plans, Aetna and Ambetter from Superior HealthPlan.
Monthly premiums for the average 27-year-old in Bexar County — before any tax credits — range from $108.78 to $386.29 depending on the plan options.
Insurance companies will need those young, healthy adults to buy insurance because new mandates under the federal health care reforms mean they no longer can turn away people with pre-existing medical conditions or charge older people much higher premiums — both groups that are more costly for the companies to cover.
Coverage takes effect Jan. 1, but consumers have until March 31 to buy a plan. Plans must include coverage for what are described as essential benefits such as emergency services, hospitalization, maternity and newborn care, and prescriptions.
Marketplace plans are categorized as platinum, gold, silver and bronze, based on premium and out-of-pocket costs. The lower the premium cost, the higher the out-of-pocket expense will be for consumers. People younger than 30 also will have the option to buy catastrophic coverage, with low monthly premiums and limited coverage.
Buyers of bronze-level coverage, with the lowest monthly premiums, can expect to pay 40 percent of their health care costs for deductibles and co-pays. Silver-level consumers will be responsible for 30 percent.
Costs will depend on family size, income, geographic location and health care needs. Tax credits will be available for individuals and families earning 138 percent to 400 percent of the federal poverty level. Qualified individuals could earn between about $15,900 and $45,960. Families of four could earn between about $31,800 and $94,200.
“Consumers have to think about their own health care needs,” Kowalski said. “How many times do you expect to go to the doctor? What drug coverage will you need? It's really a personal decision. You really need to be a smart shopper.”
lora.hines@chron.com
Express-News archives and the Associated Press contributed to this report.
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