Most of the 13.7 million uninsured young adults in the U.S. could gain coverage under the health reform law, according to a new report from The Commonwealth Fund.
A provision requiring health insurers to extend dependent coverage up to age 26 for young adults on their parents' plans goes into effect in September, providing coverage to an estimated 1.2 million young adults next year. Of that number, 650,000 are uninsured and 550,000 have coverage in the individual market and would likely switch to more comprehensive, affordable coverage through their parents' plans.
Many insurers have elected to implement this provision early, filling in the coverage gap for new college graduates.
"Young adults, often called "the young invincibles", consume relatively less healthcare than their middle-aged parents," said Lynne Dunbrack, insurance analyst and program director at IDC Health Insights. "The prevalence of chronic conditions increases with age, so we consume increasingly more health care services as we get older and succumb to chronic conditions brought on by poor behavioral choices (diet, tobacco and alcohol consumption, exercise)."
Thus for health plans, it doesn't cost them much more money to add adult dependents, who because of the current economic conditions have not been able to land a job with comprehensive healthcare benefits, she said.
"Young adults will feel the immediate impact of this new legislation, and many will benefit from the Affordable Care Act this year," said Commonwealth Fund president Karen Davis. "With secure coverage, families can be confident that their adult children will have health insurance even in economic environments that make finding a job difficult after graduation."
According to the analysis, 76 percent of uninsured young adults went without needed care in 2009 because of the cost, compared with 37 percent of insured young adults; in addition 60 percent of uninsured young adults had trouble paying medical bills, compared with 27 percent of young adults with coverage.
"This new legislation will not only make coverage more affordable, but also more comprehensive and secure, allowing young adults to pursue careers and start families without having to worry about losing their health insurance or falling into medical debt," said lead author and Commonwealth Fund vice president Sara Collins.
In 2014, expanding Medicaid eligibility could provide health insurance for up to 7.1 million uninsured young adults, and insurance exchanges and premium subsidies for lower and moderate-income families could provide coverage for more than 6 million uninsured young adults.
According to the report, new insurance market regulations, an essential benefit package and limits on cost-sharing will ensure that they have comprehensive health insurance that protects them from high out-of-pocket costs and medical debt.
The report also found that provisions in the Affordable Care Act that will eliminate lifetime limits on health insurance coverage this year could help young adults who purchase health insurance on the individual market or through their college or university avoid medical debt in the event of a serious injury or illnesses.
"Extending coverage to young adults might (also) lead to brand loyalty when they have to select their own health benefits through work or a direct pay plan," said Dunbrack.