Posted on 09 October 2013.
By Katie Kerwin McCrimmon
BOULDER — The hottest targets for health insurance this fall are the so-called “young invincibles.”
It’s no coincidence that an upstart selling some of the lowest-priced plans that might appeal to young people in Colorado, the Colorado HealthOP, deployed beautiful young models to try to make the decidedly unalluring topic of health insurance sexy. Buff, shirtless men and nearly naked young women prowled downtown Denver’s 16th Street Mall last week as Colorado’s health exchange opened. They wore little more than signs reading: “Without health insurance, you’re exposed: #GetCoveredCO.”
Less sexy street teams working directly for the state’s health exchange, Connect for Health Colorado, are hitting places where young people hang out from festivals to college football games. And the exchange’s advertising agency is targeting invincibles with neon ads that show a skateboarder going for a big move. The tag line: “If you push yourself, protect yourself.” Connect for Health is also marketing health plans with very high deductibles by calling them CYA plans rather than the stuffy, old-school term, catastrophic plans.
In Colorado, nearly 30 percent of young adults don’t have insurance. The trend is even more exaggerated among young Latinos, nearly half of whom are uninsured, according to the Colorado Health Access Survey conducted by the Colorado Health Institute and The Colorado Trust.
These healthy 20-somethings get portrayed as shallow, bungee-jumping, coffee-drinking, navel-gazers whose biggest worries center on what extreme sport they’ll master next while delaying reality and living in their parents’ basements.
In fact, when you chat with these allegedly invincible young people, you find that many hardly think of themselves as bulletproof. Instead, they are facing economic obstacles like record-high student loan debt and bleak job prospects that could keep them from affording health insurance.
“I’m anything but invincible,” says 24-year-old Evan Pilate, of Aurora, who’s working to build a business teaching piano while staying covered on his parents’ health insurance. “I work hard to stay healthy.”
The historian who coined the term millennials thinks the label “young invincibles,” is off the mark. He says a more apt nickname for this generation might be the “young carefuls.”
“Boomers took a lot more risks. We were doing all this death-defying stuff: riding Harleys, taking drugs and jumping off cliffs,” said Neil Howe, an expert on generations and social change who co-authored the book, “Millennials Rising,” in 2000 and now runs a consulting firm called LifeCourse Associates.
Howe says that by almost every measure, millennials are actually risk averse.
Crime rates have plummeted among the young along with teen pregnancy, alcohol use, cigarette smoking, and drinking and driving, Howe says.
“They trust big institutions much more than Xers or boomers. They trust big government. They trust their parents and their families,” said Howe.
“They’re risk averse. Plus they think they’re special. This leads them to have an overall bias in favor of health care, in favor of benefits,” Howe said.
Millennials talk and text with their parents constantly. Howe expects moms across the land who can no longer cover children on their own health insurance policies to encourage 20-somethings to sign up for their own plans and he thinks we all will be surprised by the relatively high number who do.
In order for Obamacare to succeed, young, healthy people need to opt in to the system in droves so their insurance premiums can help fund the older sicker folks who may be first to sign up. Young people will pay about one-third the price that older people do. That’s still far less than most will cost the system and some could balk at subsidizing their health plans for relatively well-off Boomers in their parents’ generation.
Anyone interested in buying health insurance through federal and state exchanges has until March 31 to sign up if they want any coverage in 2014. The six-month open-enrollment period that started on Oct. 1 will answer the critical question: will they or won’t they sign up?
Economic obstacles still high
While many millennials may want health insurance, economic forces could keep them out of the market. Hardly invincible, many young people instead feel inundated — inundated with student loans and high unemployment rates.
Take Kiel Lauer for example.
At 28, he is a doctoral candidate in music arts at the University of Colorado in Boulder. Since he’s a student, the university requires him to have health insurance, but the university’s plan is expensive for him, so he’s been hunting on the open market. He’s keeping an eye on rates through Colorado’s new health exchange, but had to get covered before it opened, so he bought month-to-month insurance outside of the exchange that costs about $130 a month.
Lauer is currently working as a freelance trombonist, picking up jobs in symphonies and ensembles around the state. He also works as a part-time brass instructor at Wheat Ridge High School.
None of his jobs comes with health insurance.
“Music is an insanely difficult field,” said Lauer.
The prospects for high-paying jobs are nearly nil. And getting health insurance with a job in music is exceedingly rare too. Nonetheless, Lauer stands firm on following his passion.
“I love playing jazz. I love teaching trombone. I want to play and I want to play in a solid orchestra. If teaching comes along with it, that’s great,” he said.
Along with facing low salaries, Lauer has thousands of dollars in student loan debt. He didn’t want to say exactly how much he owes, but debt will hover over him for years.
“Oh heck, at this point, I’ll probably be close to retiring by the time I pay it off. I don’t like having it….but I know this is the way it’s going to need to be for me.”
Lauer has an audition for an orchestra in Charlotte, N.C., and would be thrilled to get the job.
“Just about any of these salaried jobs would please me to death,” he said.
He thinks better job prospects are critical for young people like him.
“If we can get more full-time jobs, more people will be working so the government can get taxes to do what it needs to do,” he said.
Data from the Colorado Health Access Survey support the theory that a tough economy has been hard on young people, spurring a significant increase in the percentage of 20-somethings who went without health insurance as the Great Recession escalated.
Young people ages 19 to 29 had an unemployment rate in 2011 that was 12 percent, significantly higher than the jobless figure that same year for adults ages 30 to 64, which hovered closer to 7 percent, according to U.S. Census data and the “Young Invincibles” report from The Colorado Trust and the Colorado Health Institute.
Even if “young invincibles” have jobs, the health access survey found that only about one-third could get insurance through their jobs. That was down significantly from the last survey when analysts found than about 47 percent of young people had insurance through a job in 2008-09.
Sometimes employers offer young people insurance and they don’t take it. The No. 1 reason that people of all ages turn down health insurance from an employer is that it’s too expensive.
Invincibility seems to rank low on the list of reasons young people skip health coverage. The Colorado Health Access Survey found that only 12 percent of uninsured young people thought they didn’t need health coverage. In fact, the top three reasons young people don’t have insurance were high cost, lack of access to insurance through a job or losing eligibility for a government plan like Medicaid or CHP+, public insurance for low-income children.
Kiel Lauer wants to be covered even though he’s relatively healthy and doesn’t use any prescription medications.
He fits Neil Howe’s description of the “young carefuls.”
“There’s that off-chance that you’d have that one thing happen to you and you’d go, ‘Oh my goodness. Now I owe $300,000.’”
And, surprisingly Lauer doesn’t want to accept Medicaid or subsidies to make his health costs more affordable.
“I don’t like the idea of somebody else having to pay for me to benefit,” he said.
While young people get accused of not thinking long-term, Lauer worries about the future impact of making health care seem more affordable than it is.
“I was actually looking at Connect for Health and the subsidy issue (bothers me). There should be an incentive to keep insurance rates down without having to use taxpayer money,” he said. “There should be an incentive for insurance companies to get the prices lower versus keeping the price high and have taxpayers subsidize (health plans).
“I will be happy to pay everything if I can get a job.”
First step: Find a job
Jesse Carpenter, who turned 26 this week, also wants a job. Then he figures he’ll be able to afford health care. Carpenter was hanging out recently at CU in Boulder where he attended school and studied electrical engineering. He’s part of a Boulder juggling club and was spending a beautiful afternoon throwing clubs beneath a sprawling shady tree.
Like Lauer, Carpenter has been interviewing for jobs and would eagerly get covered if he got a job.
“At 26, I’m ready to get health insurance,” he said.
Dental coverage may be even more helpful.
“My family has a history of bad teeth.”
Lauer knows he’s vulnerable.
“The truth of the matter is that it’s luck,” he said. “I don’t want to have to worry. Let’s say I get into a bike crash. Being healthy is vitally important.”
When it comes to appealing to young people, Lauer thinks Obamacare would work best if young people got incentives, not slaps on the wrist if they don’t sign up.
Under the Affordable Care Act, nearly all Coloradans will be required to buy insurance or face a tax penalty. The penalty is very low the first year, starting at just $95 a year. It increases to $695 per person by 2016.
That won’t go over well with 20-somethings, Carpenter predicted.
“You should just leave out people from (ages) 15 to 30. They’re too rebellious,” he said. “It’s important to offer people an option to say no because (if they have to buy insurance) they will resent it for the rest of their lives.”
The key to success may be a lot of handholding that convinces young people that health coverage is good for them and helps them navigate a confusing system, said Howe, the expert on millennials.
After all, most of them are accustomed to regular care.
“They’ve had a lot of contact with health care professionals. They’ve been diagnosed with food allergies and something like 20 percent of males, by the time they’ve graduated from high school, has been diagnosed with ADHD,” Howe said. “They are accustomed to a team including a parent, teacher, counselor and doctor looking over them.”
Too much choice could frustrate millennials and prevent them from signing up.
“It implies that you don’t care what I do. You don’t care if I choose utterly the wrong thing,” Howe said.
Perhaps because helicopter parents have hovered over them their whole lives, they want guidance from mentors.
“The millennial is always accustomed to someone older that they trust helping them,” Howe said.
He advises corporations with many young employees that they’re looking for parent-style advice. They want counseling. They want help with tax prep and selecting their 401K options. Why not give them plenty of health advice too?
While 20-somethings who are earning good salaries probably already have health insurance and those who are unemployed or are barely earning any money will probably qualify for Medicaid or federal tax subsidies, Howe said the group to watch is those in the middle.
Many are working as consultants or entrepreneurs without access to any health insurance. They’re busy trying to impress big companies and affording health insurance will be a struggle.
The key to getting them to enroll may be their parents.
“They’re much closer to their parents” than previous generations, Howe said.
He predicts their parents will tell them to check out health exchanges and a surprising number will do so.
“The surprise will be on the upside,” Howe predicted. “Most will opt in because they believe in insurance. They believe someone should be looking after them. They are not risk-takers and they don’t want to cause a lot of pain for their parents.”