LETTER: Obamacare and a Millenial’s Point of View

Obamacare exchanges opened Oct. 1 in nine states as our government has recently shutdown (how fitting). The Patient Protection and Affordable Care Act, also known as Obamacare, aims to alleviate the skyrocketing costs of healthcare while broadening coverage and ensuring it to more Americans than ever.

Before Obamacare, businesses would cover health insurance costs with their own respective plans for their employees. Insurance was available for private purchase as well. Insurance companies could deny consumers health care due to preexisting conditions. Coverage costs varied based on specific coverage amenities, taking the individual into consideration, by adjusting premiums to their patients.

In order to induce Americans into furthering the law’s mission, predominantly to cover all, the law imposes perverse incentives for Americans to pour even more money into our broken healthcare system. Two inherent flaws of the law that will hit us young adults the hardest are:

1) A new definition of full-time. Here, noble motivations bring about devastating consequences. Obamacare requires “large businesses” (50+ employees) to provide plans for full-time employees. In an attempt to force businesses into covering their employees and providing quality care, Obamacare classifies employees who work 30 hours a week as “full-time.” Should businesses not comply, they will be penalized, per employee. The fee? $2,000 per employee. The penalty can inflate to $3,000 if an employee receives tax credits to purchase health insurance in ACA exchange market. So, the difference between 50 employees and 49? Up to $150,000 in taxes. Expect to see more and more small businesses that stop hiring at 49 workers unless and until they are confident of profits outweighing the increased cost.

2) Government-knows-best mentality. The Affordable Care Act establishes a threshold called “essential coverage.” If a health insurance policy does not fall within the parameters of what the law deems “essential,” it cannot be sold in the exchanges created by the law.

So, what are our options? Post-graduates likely to be working relatively low-paid jobs once they have graduated will be presented with two choices: 1) Buy a mediocre plan on the exchange or 2) remain uninsured and pay the penalty. According to the National Center for Public Policy Analysis, we will actually save money by paying the penalty. With Obamacare’s guarantee that insurance will be available without the risk of rejection for pre-existing conditions, it may well be the rational choice to remain uninsured.

Once I graduate, I will not pay thousands of dollars in penalties to be uninsured. The more likely choice is buying into the cheapest possible plan: Medicaid. With no premium, Medicaid may be the most likely option for college graduates. Ironically, this massive law, initially written to cover everyone, will now force Americans out of options.

Obamacare is ultimately a bet. If, and only if, millions of young adults pay into the system, a system in which healthy, young adults pay for sick, old adults, will costs be covered. If I were currently independent from my parents, I would either be hoping for a full-time job with a good health insurance plan, which Obamacare will make harder to find, or be buying one of the cheapest plans, which may not provide the subsidies that Obamacare proponents are counting on to keep the law solvent.

Mara Mellstrom is the President of the BU College Republicans. She is a senior in the College of Arts and Sciences studying Political Science. She can be reached at maramell@bu.edu.