After Subsidies, Many Young
Singles Will Pay at Least $2,484 a Year in Obamacare Premiums

Congressman says Obamacare has made health insurance<br/>for young people even more expensive

doctor payment
November 3, 2016

Young singles in their twenties earning an annual salary of $30,000 or more will pay at least $2,484 a year in Obamacare premiums even after receiving tax credits from the federal government, according to the Kaiser Family Foundation's health insurance marketplace calculator.

The calculator estimates the cost of health insurance premiums and subsidies for individuals purchasing Obamacare silver plans by considering various metrics including income, age and family size.

For a single, non-smoking adult aged 21 to 29 with no dependents, the U.S. average premium for those making an annual salary of $30,000 is $207 a month, or $2,485 annually, even after receiving subsidies from the federal government.

For individuals in this demographic who are between 21 and 26 years of age, the tax subsidies stop after one earns a salary of $36,000 or more, meaning the cost of premiums would increase to $282 a month, or $3,384 a year.

In its announcement confirming that Obamacare premiums would go up by double digits, the Obama administration said tax credits would help ease economic pain caused by the increases.

"Eighty-five percent of current Marketplace consumers receive tax credits that bring down the cost of coverage, and, nationwide, about the same percentage of Marketplace-eligible uninsured Americans also have incomes that could qualify them for tax credits," the Department of Health and Human Services said. "Tax credits increase dollar-for-dollar with the cost of a consumer's benchmark plan, so they protect the large majority of consumers from rate increases."

Still, many young adults will pay substantial premiums despite the tax credits, and some may decide to pay a fine to the IRS and forego insurance altogether.

The Department of Health and Human Services did not provide a comment for the story but referred the Free Beacon to data on marketplace consumers.

"Assurances from the administration that a lot of Americans are getting big subsidies ring hollow to those who don’t qualify for them," said David Barnes, policy director at Generation Opportunity.

"Americans were promised that by this year’s open enrollment period, the Obamacare-marketplaces would be robust and stable, but instead they are spiraling out of control as premiums for exchange plans rise by an average of 25 percent and insurers flee the market," he said. "As a result, many Millennials are opting to pay the fine rather than buy unaffordable and low-quality Obamacare plans."

The Kaiser Family Foundation noted that there may be out-of-pocket costs in addition to the premiums that you pay.

"Although your insurance company may cover most of the cost of your medical care, you generally have to pay something when you go to the doctor or have a hospital stay," the report said. "Your out-of pocket limit for a silver plan can be no more than $2,350 in 2017. Whether you reach this maximum level will depend on the amount of health care services you use."

"The calculations from the Kaiser calculator suggest that if people want to buy a somewhat more generous plan, they will have to pay a lot more out-of pocket," said Brian Blasé, a senior research fellow at the Mercatus Center. "People under 200% of the poverty line have a huge incentive to buy the more expensive silver plan versus the less expensive bronze plan because the cost-sharing subsidy payments, which largely reduce deductibles, are only available for people who buy silver plans."

Rep. Kevin Brady (R., Texas), who chairs the House Ways and Means Committee, said open enrollment gives Americans two choices—pay sky-high premiums or pay a penalty.

"Obamacare has made health insurance for young people even more expensive," said Brady. "Instead of taking steps to make healthcare affordable, the administration is using taxpayer dollars to mask the real costs of rising premiums and forcing young Americans to buy insurance they don’t want or need."

"Open enrollment is now essentially two dismal choices: people can either pay sky-high premiums for a plan they don’t want or need, or pay a penalty," he said. "Instead of being forced into a failing system, the American people deserve real health care choices. House Republicans have a better way to provide young Americans with affordable, high quality health options."

Published under: Obamacare