Under 30 health insurance through the reform – Apr. 28, 2010

Since “children”, will be allowed to stay on their parents plan until they are 26, and once they turn 30, they will be forced into their own plan with a maximum deductible of $2,000, there is only a very narrow band of people (between age 26 and 30), that will be permitted a purchase a catastrophic plan under very strict conditions. Also, the health bill only allows a 3:1 ratio between the youngest insured and the oldest insured, while in some states right now, it may be 10:1. This means that right now, insurers can give a 90% discount, and soon they will only be able to give a 67% discount. Therefor, health premiums will increase the most for young people.

Therefore, I disagree with the conclusion of this article.

Under 30 health insurance through the reform – Apr. 28, 2010.

Right now a 26 year old in California can get a health plan costing only $68 a month with a $3,000 deductible. This article says that a health plan with a $5,950 deductible will cost $138 per month.

I think people will pay the fine of $695 per year, rather than pay $1,656 per year for a policy with a $6,000 deductible.

Since you can go to MediBid to get reasonable cash prices for care, this will be more cost effective.

5 responses

If the government wants young people to buy insurance, they do not need to underwrite it themselves, they can simply force people to buy their plans privately, like car insurance.

Personally, I would much sooner eat the fine and get my health care privately than buy into the system they are trying to build.

As an under 30 individual, I find it ridiculous that I have to pay for someone else’s insurance. I am the only one responsible for my health, and when I am 70 I would not want anyone to support me.
What we really need to do is educate the public on what insurance is and how to use it. In addition, we need greater transparency in billing and health care costs. Then, we would not need to force people to buy overpriced insurance.

For a 27 year old costs will go from $68 to $138, and deductibles will increase from $3,000 to almost $6,000. But it’s only those aged 27 to 29 that qualify for a plan with a $6,000 deductible, the day they turn 30, they have to change to a plan with a $2,000 deductible.

If a plan for a 29 year old with a $6,000 deductible costs $138, what will a plan for a 30 year old with a $2,000 deductible cost?

Too much discussion is centered on a false belief that insurance is merely the way health care gets paid for, but it’s not! Insurance is a way for individuals to reduce the variability of how much they have to spend (i.e. paying more than you would have to if nothing bad happens in order to avoid the risk of paying a lot if something bad happens).

There is also a belief that by pooling risk, costs go away. Pooling risk across populations with similar risk profiles can reduce the variation in individual spending, but will not save money across the whole group! In fact it can only make total spending go up by reducing the costs of risky behavior like not looking both ways when crossing the street.

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