Among those hardest hit by Obamacare were young people, pressured into buying expensive health insurance full of features they didn’t need. And if they didn’t buy insurance, they were forced to pay a hefty fee to the federal government — the better option, oftentimes, given how sharply the law spiked premiums.
In many ways, the problems with Obamacare stem from that failure of young people to participate. The health insurance companies, which were forced by the law to take all comers regardless of pre-existing conditions, were losing too much money because they had to pay out claims and couldn’t get enough healthy young people in the system to offset those losses.
But if anything, the Obamacare “fix,” or Ryancare, that House Republicans have come up with is an even worse deal for Millennials. There are at least three reasons for this:
- Ryancare’s individual mandate discourages young people from buying health insurance. Ryancare gets rid of Obamacare’s individual mandate — the fine that the uninsured pay — and replaces it with a new individual mandate, one that’s not paid to the IRS but rather to the health insurance companies. The giant insurers will be able to charge those who don’t have health insurance for at least two months an additional 30 percent. But due to the sharp additional cost, this would only discourage young people, the ones who don’t normally buy health insurance, from buying health insurance.
- Young people are the big losers in Ryancare’s tax credit scheme. One of the central tenets of Ryancare is the change in the tax credit structure. Currently, Obamacare issues tax credits to help buy health insurance based on age, the local cost of insurance, and income. Ryancare would change the tax credit structure to one based entirely on age. According to the Washington Examiner, “The GOP plan provides tax credits via certain age brackets. People in their twenties get $2,000; thirties get $2,500; forties $3,000; and fifties $3,500.” Not only do young people lose under the tax credit scheme, their incomes also tend to be lower as it is.
- There’s no guarantee health insurance will get cheaper. Ryancare does not feature some of the policies that would make health insurance more affordable for more Americans. It does nothing to help insurance companies sell across state lines. It does nothing about the lack of health insurance competition in many markets. Market forces continue to remain elusive under this bill. Creating a truly national marketplace for health insurance was a goal of Republicans — at least until now. This is a missed opportunity to unleash the power of capitalism in a sector that desperately needs it.
Under both Ryancare and Obamacare, healthy young people are expected to subsidize the sick and old with few to no benefits in return. Both are terrible deals for young people; the former should be rejected and the latter repealed.