Young avoid coverage in Colorado, posing problem for health care law

Matt Leising spends about $3,600 a year on medication to treat asthma and sinus problems, so he was supportive when Washington politicians were debating the Affordable Care Act.

After the law passed and then began rolling out last fall, Leising went to Colorado’s health care exchange website to look for coverage, but the 29-year-old Littleton resident quickly realized he couldn’t afford any of the plans. He said he checked single plans and family plans because he is engaged.

The family plan with the lowest monthly premium had a deductible of $10,000, meaning he would still have to pay for his medication and other expenses, he said. He decided to just pay for his medication out of pocket and take the tax penalty.

“How could a young person nowadays afford it?” asked Leising, the manager of a small business that doesn’t provide health insurance. “I don’t see how anyone in my age group can afford insurance unless they have a really good job.”

The Congressional Budget Office estimates that 40 percent of people ages 18 to 34 need to sign up for health insurance to defray the costs of coverage for older, sicker people, but so far those figures in Colorado and nationally are half that number.

Obamacare proponents say they have several years to meet that goal. Both sides agree that if young people do not start signing up in greater numbers, premiums will increase for every insured person. However, it’s unclear how large the increases would be.

About 30 percent of Colorado exchange users are 55 to 64 years old — the oldest group of people before Medicare kicks in. Census figures show that age group is about 12 percent of the Colorado population, so older people are signing up at nearly three times the size of their population.

Only 7 percent of Coloradans signing up are between 18 and 24 — below their population percentage — and 16 percent are 25 to 34, about equal to their population.

Exchange officials point out that a February U.S. Department of Health and Human Services study showed that the proportion of people age 18 to 34 signing up through exchanges increased 3 percent in the past five months.

Ben Price, executive director of the Colorado Association of Health Plans, a health care industry group, concedes that without young people, the new law will not work. But he is optimistic that future youth enrollment will increase.

“We see a two- or three-year process getting everyone in Colorado into the system so it will work over that time,” he said. “It will crumble if we’re not getting young people, but we’re optimistic that that’s going to happen. Over a few years, it’s going to work.”

Proponents of the health care law hope more young people will be like Marty Pool. The 27-year-old, who is working on a master’s degree at the University of Denver, decided to sign up for an exchange plan, which is slightly more expensive than the coverage he was offered at DU. The exchange plan covered more and allowed him to obtain care outside of DU facilities.

“I personally have had some injuries and required orthopedics and rehab and had a friend spending $12,000 on a broken arm,” said Pool, who is paying about $200 a month for a plan with a $2,200 deductible. “I’d rather be covered for something like that. I had another friend who had brain cancer. (Health insurance is) worth it for me.”

But 27-year-old Fort Collins resident Sarah Hardin would rather save the money and pay out of pocket for treatment than spend the roughly $800 a month she said it would cost to cover her and her husband.

“When we’re not paying anything now, anything is a significant jump,” said Hardin, who owns a hair salon and makes too much to qualify for a subsidy. “Paying anything monthly is a lot.”

Hardin doesn’t like that the Affordable Care Act is shifting costs onto young, healthy people to subsidize care for older and sicker people.

“They would have young people paying more for insurance and people don’t want to pay into the system,” she said. “They’re not going to want to do that.”

Hardin said the only way she and her husband would buy health insurance is if the federal tax penalty is more than the annual costs of the policy. The maximum family penalty next year is $285 and increases to $695 a person in 2016. Those annual penalties pale to the cost of coverage for Hardin.

The penalty “would have to be pretty significant,” she said. “Most of my network connections and friends or colleagues pretty much feel the same way.”

Patty Fontneau, executive director of Colorado’s exchange, Connect for Health Colorado, said with education she expects to see more young people opting for insurance.

“At this stage, it’s early in the game,” she said. “With more socialization and the (penalties) going up, we will see more and more young population coming to insurance.”

The exchange has been advertising to convince younger people to sign up and hoping that parental pressure will force young adults to get insured.

Leising said he is disappointed that the law isn’t providing him with affordable coverage.

“It didn’t work out,” he said. “I think I was naive, but I was younger then. I thought they were going to work out the problems, but no one seems to be addressing them.”

This story was clarified to reflect that Matt Leising was shopping for individual as well as family plans, which have a higher out-of-pocket limit. Also, the tax penalty that Leising faces this year is $95 or 1 percent of household income, whichever is higher.

This story was produced in partnership with Kaiser Health News, an editorially independent program of the Henry J. Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.