OPINION:
In “The Breakfast Club” a group of high school deviants were asked to write an essay in 1,000 words or less describing “who do you think you are?” There was the brain, the athlete, the basket case, the princess, the criminal you remember.
“Kids” born in 1991, six years after the Breakfast Club, are now turning 26 and the same question should be asked: Who do they think they are? This year the answer for many will be: unable to afford health insurance.
This group of millennials is the first generation of Americans to have spent the entirety of their adulthood to date under the only universally popular provision in the Patient Protection and Affordable Care Act (Obamacare or ACA). They have had the benefit of access to health insurance “rent-free” on their parents’ coverage up to age 26. This provision is so popular that House Speaker Paul Ryan actually favored keeping this provision in the now-failed American Health Care Act.
As their birthdays come and go, these 26-year-olds are startled as they learn for the first time the true cost of health care. Their financial pain is palpable — whether from the exploding premiums on Obamacare’s exchanges or in significant employee contribution deductions from their paychecks. That is if they are lucky enough to work for a group with a health plan.
So how did age 26 become this magic, or for many now tragic, number?
At the time of the ACA’s implementation in 2010, roughly 30 percent of young adults up to age 26 had no health insurance at all. That was three times the rate of uninsured children. While a whopping statistic, nobody appears to have asked whether these “kids” actually couldn’t get insurance, or just didn’t want to seek work in a less glamorous role-up-your-sleeves type of job that provides benefits. Instead, as with other perceived problems, the government came up with a new “entitlement” solution. Put the pain felt by younger adults from health care costs on layaway and hide it under the security blanket of their parents’ coverage.
But who has really been the winner in delaying health insurance “adulthood”?
Joe Cortelli, co-founder of national health insurance brokerage HIG and a coverage expert, knows. “It’s the insurance carriers. They love having young adult ’dependents’ of employees on employer-offered plans as is helps weigh down the costs from their more expensive higher-care-use consumer parents.”
And while this healthy low-risk pool has propped up the bottom lines of certain insurance carriers, the law of unintended consequences has taken hold.
The age-26 provision has played an instrumental role in deflating Obamacare’s “get covered or pay up” mandate model. “The policy has proved to be a double-edged sword for the ACA’s online health exchanges because it has funneled young, healthy customers away from the overall marketplace ’risk pool.’ Insurers need those customers to balance out the large numbers of enrollees with chronic illnesses who drive up insurers’ costs — and ultimately contribute to higher marketplace premiums.”
Doesn’t this sound similar to another pressing issue for millennials?
They have the dubious fortune of having the largest student loan debt of any generation of Americans. To be exact, for the class of 2016, it is $37,172 on average per graduate. This massive group of young adults has deferred the pain of debt payback by riding on their parent’s “credit” with the government’s full support, ultimately benefiting big business.
More and more young people are heading to college only to take jobs post-graduation that do not allow them to make the minimum payments on their loans. Some 3,000 Americans are defaulting every day on their student loans. Even scarier, delaying the financial responsibilities of adulthood has led many of these clueless “kids,” in debt up to their eyeballs, to think nothing about using borrowed high interest rate dollars for spring break benders.
The parallel to the national drug abuse epidemic is stark. According to the National Institute on Drug Abuse: “Young adults (age 18 to 25) are the biggest abusers of prescription (Rx) opioid pain relievers, ADHD stimulants, and anti-anxiety drugs. They do it for all kinds of reasons, including to get high or because they think Rx stimulants will help them study better.”
Prescription drugs, for most of us, require having some form of health insurance. Would these “kids” feel different about their rampant use of addictive drugs if they had to pay out-of-pocket earlier for their health care, rather than counting on good old Mom and Dad until age 26?
So what do those of us observing all of this have to look forward to? Vice Principal Richard Vernon from “The Breakfast Club” said it best: “You think about this: These kids when I get old — they’re going to be running the country.”
At least we can hope it’s not the criminal.
• Bryan Rotella is the founder and CEO of Rotella Legal Group.
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