Building an Economy that Works for Everyone

New research: Young adults gaining health coverage under Obamacare

It's not a place most young adults want to end up - but many more have insurance when they arrive. Credit:

Obamacare is improving insurance coverage among young adults – and saving them a lot of money in the process. [Photo: rob_nguyen via Flickr Creative Commons]

With youth unemployment stagnating above 16% and student loan debt soaring to nearly $1 trillion, today’s young adults are facing a rocky start to financial independence. But one thing they can breathe a little easier about is increased access to health coverage.

Thanks to the Affordable Care Act (ACA), starting in 2010 young adults can stay on their parent’s coverage up to age 26. Here in Washington state, more than 62,000 young adults have gained health insurance because of that provision.

While Washington state already had a law in place to allow dependents to stay on parental coverage up to age 25, the ACA expands Washington’s law up to age 26 and does not limit coverage to unmarried dependents. In other states, the improvement was even more dramatic.

By the end of 2011, more than 3 million 19- to 26-year-olds had gained coverage under the ACA. A report from the Centers for Disease Control and Prevention found the percentage of 19- to 25-year-olds lacking health coverage dropped from 35% in 2010 to 27% in 2012.

The increased insurance coverage is having a significant impact in emergency rooms. Researchers analyzed emergency department visits made by individuals aged 19-25 vs. 26-31, from 2009 through 2011. They found a significantly increased rate of private coverage for visits made by 19-25 year olds once the law was in place, compared to no change for the older control group.

Furthermore, the rate of uninsured visits fell while that of visits made by individuals covered by non-private insurers remained steady. This means the increase in covered visits isn’t simply due to more visits overall, nor is it due to increased visits by those with Medicaid or Medicare – young adults are gaining private coverage.

Researchers also found emergency room costs paid by insurers for these newly covered young adults totaled $147 million over just one year – a hefty chunk of change the youth did not have to pay thanks to the new law. With medical debt cited as a contributing factor in a majority of bankruptcies (62% in 2007), potential medical costs are a looming threat to youth battling unemployment, underemployment, and sky-rocketing costs for higher education.

The Affordable Care Act is proving to be a boost for youth that may mean the difference between economic security and long-term financial strife.

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