Dying of old age

"Dying of old age" Continued...

Issue: "American bounty," Nov. 30, 2013

Some analysts have attributed young adults’ low enrollment numbers to the faulty website or youthful optimism that they won’t need insurance. Brian Mueller, 28, an adjunct music professor in Ohio, said the problem is having to pay for coverage he doesn’t need and can’t afford. “I know that I probably won’t need my health insurance, but I still like to have it,” he said. “I feel like they’re trying to sell me a luxury car when all I need is a commuter car to get me from point A to point B.” 

Mueller’s job, which continues on a per-semester basis, doesn’t include insurance, but it has given him the financial flexibility to buy an individual policy. Blue Cross Blue Shield notified him that his policy will be canceled next year—and he found out his doctor will no longer take his insurance—so he’s contemplating the fine. “If the penalty is only $95 a year, I’d have to consider it,” Mueller said. “I may not have an option.”

Many people are considering paying the fine in 2014, but few will dish out only $95. The law calls for a $95 penalty or 1 percent of household income, whichever is greater—meaning the fine becomes $650 for a household income of $65,000. The fines will sharply increase in 2015 and 2016 (see graphic).


While Washington is in an uproar over the unworkable website, viable ideas to improve the law are scarce. Several health policy experts told me there is a shortage of long-term, creative thinking, because both sides have been gridlocked in the political battle over the law’s existence. Yet even if Republicans were to win control of the Senate next year, Obama doesn’t leave office until January 2017, so the law is likely here to stay. 

Don Taylor, a public policy professor at Duke University, told me at some point Republicans “will say, ‘Gosh, even if we’re against the ACA, we’ve got to address this.’” Taylor cited, among other things, the provision that allows 26-year-olds to stay on their parents’ plans as something that will likely have to change. “In the long term, it doesn’t make that much sense to call a 25-year-old a kid,” he said. “That redefined young adults as potential dependents.”

AEI’s Joe Antos believes a needed change is the 15 to 20 percent cap on administrative costs for insurance companies (a few states have already received waivers). Since coordinating and managing care is considered an administrative cost, he said the law encourages insurers to cut corners where it hurts patients most. 

Two other possible ideas: lower the coverage requirements and allow the community rating to be 6-to-1—or whatever the market dictates. Permitting young adults to sign up for only catastrophic coverage would encourage more participation, and allowing appropriate premium disparity would shift the burden of cost away from young people with typically lower incomes and toward those with established careers. 

Antos predicted Obama will allow tweaks before the 2014 elections—perhaps waiving the fine for not having insurance—but major changes may have to wait until 2017. He said the next administration, regardless of which party wins the White House, will be forced to deal with the issues. 

For now, those whom the law was intended to help, such as Melody DuVal, see Obamacare doing more harm than good: “It’s not helping me, [and] it’s not helping any of my friends.”

The week after I spoke with Jeremy Oosterhouse in early November, he emailed to say he and his wife are seriously considering Medi-Share, one of the three main medical bill-sharing groups that have been growing in a loophole of the ACA. Oosterhouse said even if he qualified for a subsidy, he could save $125 per month ($300 without a subsidy) for a plan with a deductible that is $2,000 lower than what he can get through the exchange.

“As Christians, there is something of value to supporting others with medical costs and trusting in God to provide for our needs,” he said. “That’s money we can continue to put toward retirement, [2-year-old daughter] Leah’s future Christian school costs, or even allow Rachel to continue staying at home with the kids.”

J.C. Derrick
J.C. Derrick

J.C. is WORLD Magazine's Washington Bureau chief. He spent 10 years covering sports, higher education, and politics for the Longview News-Journal and other newspapers in Texas before joining WORLD in 2012. Follow J.C. on Twitter @jcderrick1.


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