Will the Young (aged 18-40) Scuttle Obamacare?

Scuttle – 1) to sink a vessel by deliberately opening the seacocks or making openings at the bottom; 2) to disable or destroy (plans, hopes, etc).

Dictionary Definition

Health insurance is a product, not a social vision. Obamacare will cause insurance premiums to rise sharply for the healthy and the young.  When it comes to products, Americans aged 18 to 40 act like consumers of all ages everywhere.  They have a price point and when the price gets too high they get busy making changes.

Douglas Holtz-Eakin, “Sharp Shoppers Scuttle Obamacare;  The Young  Scuttle  Coverage to Avoid Higher Premiums, “ Real Clear Politics, May 20, 2013

Will young Americans sink Obamacare?   Obamacare rests on the premise that the young and healthy will pay for the old and the sick. We are all in this together, the premise goes, so let’s redistribute the benefits so everyone gets a fair shake.

Obamacare is a bold social vision,  perhaps a bold socialist vision.  The only problem is that America is a consumer-based capitalistic  country.  It is a nation that believes in a fair price for each individual,  in equal opportunities to get a good deal for each product in  the marketplace, not the same price for all,  not the same-size-fits-all for all.

Health care as a product is where  a consumer-driven vision comes in.

According to a recent national  survey conducted by the American Action Forum  among the young who already have insurance.

·         If health premiums rise 10%,  83% will continue to buy health insurance.

·         If premium rise 20%, 65% will continue to buy insurance.

·         If premiums rise 30%,  55% will still buy health insurance.

·         At the 30% level,  20% would rather pay the penalty rather than pay the premium.
 

The point is: the  young are price sensitive and regard health insurance as a product not a social vision.

Douglas Holtz-Eakin, president of American Action Forum, and former director of the Congressional Business Office, concludes:

“Obamacare is a controversial law whose provisions have received a mixed public reception.  These results are echoed by the sentiments of the 18-40 year olds polled by the American Action Fourm. Obamacare is intended to expand insurance coverage by mandating that those same young Americans form a lower-cost insurance pool.  This group, however, powerfully undercuts this goal . Behaving like all price-conscious consumers, young Americans will drop their insurance in the face of sharp premiums increases.”

The Moral of This Tale

The moral os this tale might be: When the going gets tough for young American health care shoppers, the tough stop shopping for health insuarance.

Tweet:  Obamacare implementation depends on  the young (aged 18-40) buying health insurance to support the old. This may not be forthcoming.