By Emily King
What comes to mind when you think of the term “Young Invincible”?
You might picture a twenty-something, perhaps unemployed or underemployed. Maybe living in a parent’s basement, consuming an above-average amount of Ramen noodles. This twenty-something chooses not to purchase health insurance, the thinking goes, because getting sick is not something he or she can even picture — a perceived invincibility – and there are plenty of more fun things to buy.
Findings from the 2011 Colorado Health Access Survey (CHAS) suggest that last sentence isn’t true for most young adults between the ages of 19 and 29 in Colorado. In fact, a perceived “invincibility” is way down on the list of reasons that uninsured young adults lack coverage.
The top of the list? Cost.
When asked why they were uninsured, young adults supplied some of the following reasons. Note that a perceived invincibility was mentioned by only about one in ten respondents:
- Cost is too high (mentioned by 77 percent of respondents)
- If working, not offered insurance or not eligible for insurance (50 percent)
- Insured family member lost job or changed employers (29 percent)
- Lost eligibility for Medicaid or CHP+ (24 percent)
- Do not know how to get health insurance (13 percent)
- Do not need health insurance (12 percent)
The latest CHAS issue brief, “Young Invincibles? Why Young Adults Have Colorado’s Highest Uninsured Rate” analyzes this finding and many others about health insurance coverage for young adults. For example, in 2011 young adults had the highest uninsured rate (29 percent) of any age group in Colorado. This percentage is up significantly from the last CHAS survey in 2008-09, when approximately 22 percent of Colorado young adults were uninsured.
While young adults make up 16 percent of Colorado’s population, they comprise 28 percent of Colorado’s uninsured.
This lack of health insurance among young adults has important implications for their ability to access care. Nearly one-quarter of young adults reported not seeing a doctor due to cost, and nearly 20 percent reported not filling a prescription. The CHAS finds that only 70 percent of young adults in Colorado have a usual source of care, the lowest rate of any age group.
Understanding members of this age group and their relationship to health insurance will become increasingly important as we head into next year, when the Affordable Care Act will require most Americans to buy health insurance or pay a tax penalty.
While all ages will be impacted by these provisions, the high number of young adults without health insurance suggests that they may be one of the groups most impacted.
In particular, we’ll be watching how young adults respond to the so-called “individual mandate.” Will they choose to purchase coverage or pay the penalty? In my opinion, one of the most fascinating findings from this report is young adults’ responses on the topic of affordability. The CHAS asked uninsured young adults if they were able to afford anything for health insurance. Nearly three-quarters agreed that they were able to afford coverage. CHAS then asked those who said they were able to afford health insurance how much they’d be willing to pay for it. Only 39 percent said that they would be willing to pay more than $75 a month for health insurance.
These young adults may be in for some sticker shock. The Kaiser Family Foundation estimates that in 2014 a health insurance premium on the exchange will cost $144 a month for a single 25-year-old earning $25,000 a year.
Doing the math, many young adults may choose to pay the tax penalty – starting at $95 in 2014 and rising to $695 two years later – rather than purchase subsidized health insurance coverage.
We don’t know how many young adults will choose to buy insurance. But we do know that members of this group will be an important market for insurance companies as well as the Colorado Health Benefit Exchange because they represent relatively low risk. The exchange, in particular, will be trying to target this demographic to help offset the costs of insuring potentially less healthy – and more costly – older adults.
The Colorado Health Access Survey will continue to serve as an invaluable tool to help us answer these questions—and many others—around the implementation of health reform. Stay tuned!
Emily King is a research analyst at the Colorado Health Institute.