Experts warn a lot of these so-called “young invincibles” could opt to pay the fine instead of spending hundreds or thousands of dollars each year on insurance premiums. If enough young adults avoid the new insurance marketplace, it could throw off the entire equilibrium of the Affordable Care Act. Insurers are betting on the business of that group to offset the higher costs they will incur for older, sicker beneficiaries.
The nonpartisan Congressional Budget Office estimates that about six million people of various ages will pay the tax penalty for not having insurance in 2014, the first year the law championed by President Barack Obama will be fully implemented.
It’s hard to estimate how many of those will be the young and healthy adults insurers are trying to reach, but that subgroup makes up a very small portion of the overall market. Even though it’s small, experts say it could be enough to throw the system’s financing off-kilter…
Premium hikes could be a disincentive for young people weighing their options. Premiums for people aged 21 to 29 with single coverage who are not eligible for government subsidies would increase by 42 percent under the law, according to an analysis by actuaries at the consulting firm Oliver Wyman. By comparison, an adult in his or her early 60s who would see about a 1 percent average increase in premiums under new federal health rules.