Young Adults Will Enroll in Insurance if They Know About and Can Afford It

Young adults fail to obtain health insurance due to cost as opposed to the believing that they don’t need health insurance, according to a study from the Commonwealth Fund. Based on this finding, and the amount of subsidies available to individuals who purchase health insurance from the exchanges, the study’s authors concluded that outreach and education efforts will be the key to reducing the number of uninsured young adults. The success of reducing the number of uninsured adults, though, is going to be limited due to the failure of nearly half the states to expand their Medicaid program to make people with incomes up to 133 percent of poverty eligible.

Cost Not Invincibility

The study found that young adults fail to obtain health insurance because of the cost, not because they feel like health insurance does not provide them with any benefit or is a service they simply will not need. The Commonwealth Fund Health Insurance Tracking Surveys of Young Adults found that in March 2013 15 million 19-to-25-year-olds had been on a parent’s health insurance policy in the prior 12 months. This is half of that age group. This is also an increase of 1.3 million from before November 2011, according to an earlier study. The Affordable Care Act (ACA)(P.L. 111-148 and 111-152) required all health insurance plans to cover young adults up to age 26 on their parent’s health insurance plan beginning in September 2010.

In Massachusetts the uninsured rate for 19-to-26-year-olds fell from 21 percent to 8 percent within one year of enactment of the state’s health reform law. Enrollment rates among young adults who obtain employer based health insurance are high. More than 67 percent of young adults eligible for insurance from their employer have enrolled. Even more impressive was that 79 percent of young adults from age 26 to 29 who had access to employer sponsored health insurance obtained it. This age subset is more likely to be offered employer sponsored health insurance. “Affordability, not ‘invincibility’ is why most young adults lack health insurance,” according to the study.

Awareness

The study found that only 27 percent of young adults 19 to 29 were aware of the health insurance marketplaces, with awareness the lowest (19 percent) amongst young adults who were uninsured during the past year and amongst low-income households (18 percent). A third of college graduates were aware of the availability of health insurance at the marketplaces. Rising awareness is correlated to rising enrollment. The study found that when young adults became aware that they could enroll in their parent’s health insurance plan, enrollment reporting also increased, and the number of uninsured young adults decreased. Based on these findings and experiences, the study’s authors concluded that outreach and education is the key to driving down the uninsured rate amongst young adults.

Failure to Expand Medicaid

The study found, however, that a significant number of uninsured adults will not be able to obtain Medicaid coverage due to the large number of states that have not expanded the eligibility requirements up to 133 percent of poverty. The study noted that 28 percent of young adults who were uninsured last year had family incomes below 100 percent of poverty. Increasing awareness of insurance options seems to be the key to driving down the rate of uninsured among adults. When young adults became aware that they could enroll in their parent’s health insurance plan, the number of uninsured young adults decreased. The study concludes that outreach and education about insurance available on the insurance marketplace will be key to the success of driving down the number of uninsured adults, but that success will be limited due to the number of states that have decided to expand their Medicaid eligibility standards to include people up to 133 percent of poverty.