Young, healthy people in high demand for new health exchanges

October 2, 2013

WBEZ/Lauren Chooljian
Rachel Ullrich and her son Owen play with their chihuahuas. Ullrich is currently uninsured, but as a young, healthy person, she’s part of the demographic that could make or break the new insurance exchange.

Rachel Ullrich quickly grabs the hand of her four-year-old son Owen as he tries to scurry across an alleyway in the Avondale neighborhood of Chicago.

“What do you do in an alleyway?” she asks him.

“Look both ways,” he replies.

“Good job. Any cars?” Ullrich asks him.

He shakes his head from side to side, looks around for a minute, and then squeals, “Nope!” before quickly walking ahead of his mom.

Ullrich says she’s - as she puts it - “super cautious” while walking around her neighborhood. She says she’s constantly thinking about her health and that of her son’s seven minute walk to and from preschool everyday. Ullrich has been without health insurance for the past few years, and it’s made her tread very carefully - she eats healthy, runs when she can, has cut back on driving and has even given up riding her bike.

Especially after her boyfriend had to pay over $13,000 out-of-pocket when he busted his elbow in a bike accident a few years back.

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“It sounds like I’m a nutter, but I’m really not that meticulous,” she said. “It’s just not having health insurance, and the constant worries (about) that I’m always mulling over (that) have kinda just shaped what we do everyday.”

Ullrich works as an independent contractor for an audio visual archiving firm. She also sells vintage items on Etsy. Insurance hasn’t really been in the budget, but she’s able to get Owen coverage through the state-run All Kids program.

So far, the 32-year-old says it’s worked for her. UIlrich is the picture of perfect health, give or take a cold here and a root canal there.

Ullrich is part of the demographic that experts say could make or break the new insurance marketplace. Joel Shalowitz, director of the Health Industry Management program at Northwestern University’s Kellogg School of Management, says the age bracket of 18 to 34 year olds has historically had the highest number of uninsured people.

“The feeling and thoughts of a younger person is that, gee, I’m young, I’m healthy, I never see a doctor, I’m fine, what could possibly happen?” Shalowitz said.

And for an insurance exchange to work economically, Shalowitz says there has to be enough healthy people enrolled to cross-subsidize the older people with health problems.

“If we only get the sick people, when the calculations are done, the cost of each of these plans are going to go up. Which would make it potentially more unaffordable for other people.”

It’s commonly referred to as the “death spiral”: The fewer healthy people there are in the exchange, the higher costs will go for the remaining plans. And as prices go up, more people could drop out, leaving even sicker people in the exchange. As Shalowitz puts it, “the thing would just spiral up and up until they become unaffordable and it fails.”

“That’s a real fear for the people who wanted to make these exchanges the solution for our health care problem,” Shalowitz said.

Shalowitz says many young people might choose to go uninsured this year- opting instead to pay the penalty of $95 dollars or 1 percent of their annual income, whichever is greater.

Organizers from all sides are interested to see what this group will choose.

The Young Invincibles, for example, is a national organization that started back in 2009 during the healthcare debate. The group focuses on issues that matter to 17 to 34 year olds. They just opened a Chicago office early this summer.

Here’s an example of how they craft their outreach: One tweet recently tagged the band *NSYNC, with the message: “Pre-existing conditions were #TearinUpMyHeart. Now I can #GetCovered.”

“Our target is to make sure that every young person that wants health insurance has it,” said Brian Burrell, Midwest Regional Manager for Young Invincibles. “And we’re gonna keep working until that happens.”

By their numbers, there are around 690,000 uninsured 18 to 34 year olds in Illinois. Of those, up to 415,000 could qualify for tax credits, and up to 267,000 could qualify for Medicaid.

“Not many of them will have the financial background or knowledge of health insurance that some of the other age segments might, and so it’s really important that there’s a heavy education to explain what the difference is,” Burrell said.

Meanwhile, counter efforts, like Generation Opportunity, are trying to get young people to opt-out of the health care exchanges.

They’ve funded online advertisements-- over 2 million people have seen them so far- where a creepy-looking Uncle Sam pops into a doctor’s appointment with a young guy or girl. Spokesman David Pasch says they’ll be visiting college campuses this fall to spread their message that choosing to opt out of Obamacare might be cheaper.

Rachel Ullrich, for one, says she is looking forward to signing up for the exchange - even if it requires some budgeting.

“Even in the long run, if it does put a little bit of strain on our monthly finances, I’m more comfortable with that strain than not having the health insurance at all,” she said.

But as to how many people will join her, Northwestern’s Joel Shalowitz says it’s almost impossible to know for sure. He says it’s kind of like the Field of Dreams - if you build it, they will come, but nobody knows exactly how many for sure.

Correction: In an earlier version of the radio version of this story, the report said: “The Young Invincibles is a national organization that started back in 2009 - when the healthcare law was first passed - that is solely focused on issues that matter to 17 to 34 year olds.”

The health care law first passed the US Senate in 2009, but didn’t pass the House until early spring of 2010 and became law soon after. The report has since been changed for clarification.

Lauren Chooljian is a WBEZ reporter/producer. Follow her @laurenchooljian