Sen. Tammy Baldwin, D-Wis., has introduced a bill that would increase the amount of Obamacare subsidies that go toward younger adults, aiming to bring more of them into the exchanges to help stabilize the marketplace.
The Advancing Youth Enrollment Act would give higher federal subsidies to people between the ages of 18-34 so that the cost of private Obamacare plans for them would be lower. Under Obamacare, people who don’t get health insurance through a job or through a government program, like Medicare or Medicaid, can buy health insurance with the help of the federal government.
The share of federal dollars would increase under Baldwin’s bill. Under the proposal, young adults would see the maximum percentage of income they must pay toward health insurance under Obamacare decrease by 2.5 percentage points for people between the ages of 18 to 30. Each year after, until the age of 34, they would see a gradual phaseout of 0.5 percentage points a year.
Obamacare has cut the uninsured rate among young people by more than half, both through them purchasing these private plans but also through allowing people to stay on their parents’ plans until the age of 26. Still, the participation in the exchanges of this group isn’t as high as insurers would like to see, with 8 million in this group still uninsured. Young, healthier people are a coveted part of the health insurance market because their participation helps balance out the cost of older, sicker enrollees, keeping premiums down for customers overall. This is particularly true in rural markets with fewer potential customers.
An analysis by the pro-Obamacare group Young Invincibles projects that 4 million people between the ages of 19 to 34 would be eligible for higher subsidies if the legislation passed. Nearly half a million could be able to have health insurance that would come with no deductible and with a premium of $23 a month or less, and 300,000 people would have no premium at all.
At this time, a typical young person with coverage from the Obamacare exchange, purchasing a mid-level silver plan, is paying about $150 a month. That same plan would be $95 under the Advancing Youth Enrollment Act.
