Our Idea: Insuring Millions of Young Adults Could Potentially Save the Government Billions
In these tough economic times, the only thing more difficult for young adults than getting a job is finding one that offers health insurance. Unable to a secure a job that provides coverage, millions of young adults find themselves ineligible for Medicaid and incapable of affording private insurance, leaving them vulnerable to tremendous financial and health risks. Our goal with this campaign is to extend health coverage to millions of young adults, while at the same time potentially saving the government billions.
The Facts:
• Young adults between the ages of 19-29 are the largest group of uninsured by age in the nation. According to the March 2008 Current Population Survey, at least 13.2 million young adults are uninsured.
• Young adults are disproportionately represented among people who lack health insurance, accounting for nearly 30 percent of the 45 million uninsured people under age 65, even though they comprise just 15 percent of the population.
• Of all uninsured young adults ages 19-29, more than 7 in 10 (72%) have household incomes of less than 200 percent of poverty.
• Young Adults typically lose health insurance coverage under a parent’s or guardian’s policy at age 19 or upon college graduation.
• In the current economic environment, fewer companies are able to offer young adults health benefits compared to older Americans.
• Most of the uninsured young adults are ineligible for Medicaid.
Our Plan:
SHOUTAmerica proposes to cover at least two million young Americans by redefining dependent status to a national standard up to age 26, regardless of student or employment status.
Proposed Redefining of Dependent Status:
• Up to Age 26
• Unmarried and no dependents of their own
• Independent of student status or employment status
• Regardless of State of Residency
• Limitations of 3 percent on extra premium charge
The Argument:
While Congress makes the tough decisions about how to reform America’s $2.4 trillion healthcare system, SHOUTAmerica believes that it is imperative for policymakers to pass legislation to extend coverage to the nation’s largest uninsured group – young adults. At present, the unemployment rate for young adults is nearly twice that of the rest of the nation. As we all know too well, the only thing more difficult for young adults than getting a job is finding one that offers health insurance.
Millions of uninsured young adults are facing tremendous financial and health risks, however according to the Commonwealth Fund, by simply changing the dependency status we could conservatively extend insurance benefits to over two million young adults currently living with their parents and millions more living on their own, but without the means to afford their own coverage.
Allowing millions of these young, otherwise uninsured, Americans to retain their current coverage would be a source of instant relief in these difficult economic times. Many states have already recognized this as a cost-effective means of reducing the ranks of the uninsured and it is time for the rest of the nation to get on board, especially as the federal government contemplates how to fill in the significant coverage gaps left by the current healthcare system.
If Congress ultimately passes healthcare reform that subsidizes insurance plans to make them more affordable for Americans, raising the dependency status to age 26 could potentially save the government billions of dollars in federal subsidies. 72% of the at least 13.2 million uninsured young adults have incomes less than 200 percent of the Federal Poverty Level, therefore most of these young adults would qualify for a 100 percent subsidy under many of the existing healthcare reform proposals being floated around. Thus, if changing the dependency status conservatively insured 2 million young adults under their parents’ plan, it would save the federal government approximately $9 billion a year in subsidies.
So, how would this plan affect employers? According to estimates by the Commonwealth Fund, if the benefit requirement were extended to all family policies, the average premium for those plans is estimated to rise by about 3 to 4 percent. In states that have a dependent status cap of age 19 currently, employers would be able to mitigate the cost to the company by simply adding an extra premium surcharge of 3 percent if the employee has a dependant above the age of 19 years of age on his or her insurance policy.
Regardless of whether our nation’s healthcare system is overhauled, this policy is a way to bring affordable insurance to struggling young Americans. So we encourage you to support this campaign, and we hope that you will ask your friends, family, and members of Congress to support this legislation.
How You Can Help:
• Write a personalized letter to legislators or the media
• Follow SHOUTAmerica on Facebook and Twitter
Additional Resources to Learn More about the Issue: