Happy Birthday, Obamacare? What It Really Means for Young Americans

Kathryn Nix / March 25, 2011

This past Wednesday marked the first anniversary of Obamacare. While advocates spent the week highlighting the new law’s effects on different groups of Americans, we’ve done the same. A review of the facts on the ground and the conclusions of Heritage research over the past year reveal the far-reaching negative consequences of the new law.

Today, liberals are arguing that Obamacare helps young Americans. Although there are benefits from some provisions of the new law—for example, young adults can now stay on their parents’ health plan until age 26—young Americans will ultimately experience negative effects under Obamacare.

Under Obamacare, “young invincibles” are disproportionately burdened by higher insurance premiums. First, the act places a new community rating restriction on insurance companies so that they will be unable to charge premiums that differ by more than a 3:1 ratio by age. This will require younger, healthier, insured Americans to pay higher premiums to subsidize those who are older, sicker, and more expensive to insure. Since young and healthy individuals are less likely to buy insurance, policies that increase premiums will deter them from seeking coverage in the first place. (more…)