The Affordable Care Act and Millennials

Posted on: Wednesday, August 14, 2013

“I don’t need health insurance. I’m perfectly healthy.” This is the mantra of the Millennials, young adults who came of age at the turn of the new century. If you are expecting the Affordable Care Act to work successfully, then you must be hoping that they change their opinion about health insurance.

In order for costs to be kept low, Millennials must participate in the program. Beginning in 2014, nearly everyone will be required to have insurance or pay a penalty of about 1% of their household income in the first year, with an increase in penalties over subsequent years. Currently, young adults under the age of 26 can be covered by their parent’s health insurance. In 2014, many Millennials who are not covered through work, or their parents, will be eligible for insurance through the new state-based insurance marketplaces. However, this by no means guarantees that they will take the coverage afforded them.

Millennials are faced with the option of paying a small fee (an average of $95 the first year) for not complying with the law, or paying a larger amount in a subsidy to get health insurance. They need to be convinced that the insurance is valuable to them. Older citizens, who have an overall greater need for health insurance (and who generally pay higher out of pocket expenses) are likely to sign up for the benefits at their state marketplaces. Without younger, healthier people in the same marketplaces to balance the expenses, the costs are expected to rise. 

States and the federal government are expected to campaign for Millennial participation through social media and other influential areas. Organizations such as Young Invincibles, an advocacy group, are attempting to raise awareness of the options that young adults will have beginning in 2014. Of course, due to the enormous controversy associated with the implementation of the Affordable Care Act, many government agencies have been reluctant, or slow, to act.

In fact, some states have yet to finalize the costs of their plans, which prevents people from having the facts they need to make fully informed decisions. Some states, like California, however, have an online calculator which can help their citizens approximate their insurance costs through the Marketplace program. A single, 27 year old female making $25K annually would pay a total of $144 annually (after a $97 tax credit) on the Silver plan. The Bronze plan, which has lower monthly premiums, would cost the same person much less.

Millennials have important decisions to make as the Affordable Care Act makes its way into our lives. Without them, however, the way forward will be difficult for the rest of us.

Do you have questions about the Affordable Care Act? We have a call center which is ready to help you navigate through the maze of complexities in the new world of health coverage.

Please call 1-800-877-214-2969. We’re ready to assist you.

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