The common retort to, “Hope and Change,” is that change is what will be left in our wallets after health care reform kicks in. For those under the age of 30 this could not be more true. The actuarial folks at Blue Cross and Blue Shield of Arizona estimate that premium rates for this segment of society may rise by 30%. This prediction, coming from the largest non-profit health insurance company in the state should be of concern to all of us.
A reasonable, prudent person may wonder how our younger citizens are going to pay much higher premiums in 2014 than they do today, subsidy or not. For the answer we need simply look at one factoid true today. One of the largest uninsured segments of our population are those in the 18-29 age bracket. Human beings are predictable. If they choose, in many cases, not to have health insurance now, what are the chances that they will be willing to spend 30% more for a product that they don’t buy presently? They won’t. They will pay the fine for not being the owner of an Arizona health insurance policy… that is, if the government actually has a way to enforce and collect the small fine, and wait to buy health insurance when a claim arises.
The math is pretty straight-forward. If you are young you may qualify for a federal subsidy of between 10%-40% to help pay for your health insurance. But remember that premiums will be at least 30% higher in 2014 for the younger folk because of new restrictions placed on insurance companies to charge a reasonable price for the older generation. Because of this the true cost of a policy for a young person in 2014 will be right where they are today. If they aren’t buying a medical insurance policy now, why would they buy such coverage in 2014? Again, they won’t. They will wait until they have a claim and then buy the health insurance, with no worry of being denied said insurance. We can all guess what this will do to premium rates in general.
The new health insurance reform law is an accident waiting to happen, and covering the losses will not be possible unless changes are made.
Michael Higgins
602.405.8769
An Arizona health insurance broker.