A new study by the American Action Forum (AAF) inaccurately suggests that young women who purchase coverage in the individual market will face dramatic premium increases as a result of the health care law, also known as Obamacare. AAF concludes that premiums will rise, on average, 193 percent for a 30-year old single woman – a conclusion that doesn’t account for many elements of the law which ensure that she would have access to quality, affordable health care.
Below are several areas of the health care law that AAF fails to fully address in its analysis:
- AFF doesn’t fully account for the impact of subsidies across the population. The health care law provides financial help – in the form of subsidies – for families and individuals to afford health coverage. While AAF acknowledges that young women with incomes below 400 percent of poverty ($45,960 for a single person) can qualify for premium subsidies, they fail to include this financial assistance in their calculation of average premium increases for young women.
- AFF fails to address the expansion of Medicaid coverage. States have the option of expanding Medicaid coverage for individuals with incomes up to 133 percent of the federal poverty line, or $15,200 for a single person. But, again, AAF fails to note that some young women will become eligible for Medicaid coverage under the law. Nor does AAF include Medicaid’s modest premiums in their calculation of average premium increases.
- Young women can still buy catastrophic plans. AAF assumes that young women will seek the lowest cost plan available to them. However, the study does not examine catastrophic plans for young people under age 30. Catastrophic plans offer lower premiums but higher deductibles. AAF should have included this option in their analysis to account for the full range of choices available to young invincibles.
- AFF does not account for improvements in coverage. The health care law requires that qualified health plans cover essential health benefits, including maternity coverage – an important benefit for young women. Of the five states AAF finds to have the highest monthly premium increase, three of them – Nevada, Alaska, and Mississippi – previously had no health plans with maternity coverage on the individual market. Many women in this age group will seek maternity care and this new coverage will allow them to get the care they need.
The American Action Foundation concludes that young women who do a cost-benefit analysis of the cost of insurance premiums versus the cost of the penalty for forgoing coverage would choose not to purchase health insurance. But, the study doesn’t acknowledge that a majority of young people want health insurance. Previously, many women sought coverage but were charged more by insurance companies simply because they were a woman or were denied coverage because they had a pre-existing condition. But under the health care law, insurance companies can’t discriminate against women and must cover women with pre-existing conditions. And, when a young woman purchases health insurance she gets something for her money – health care when she needs it, as well as financial security if she gets seriously injured or sick. In contrast, the penalty provides no such benefits at all.
In short, young women should not be dissuaded from buying health insurance by the alarming conclusions of the study, despite the fact that they will be better off with the new health insurance options available to them thanks to the health care law.
This post was cross-posted here with permission from National Women’s Law Center