Evan Feinberg: Millennials should opt out of Obamacare

10/01/2013 12:00 AM

09/30/2013 6:51 PM

In preparation for Tuesday’s rollout of the Affordable Care Act, the Obama administration has taken its message to college campuses like Wichita State University to sign up as many students as possible. It has even brought on board Lady Gaga, Jennifer Hudson, Amy Poehler and other celebrities to help convince millennials that the exchanges are cool.

Apparently the administration thinks millennials are gullible. But no veneer of popularity can mask the exchange system’s deep problems. The simple fact is that the exchanges are a bad deal for young people. And as a result, it makes more financial sense for millennials to opt out and purchase a non-Obamacare policy on the private market.

The most obvious problem with the exchange system is how it perversely relies on a system of generational redistribution. Quite simply, the law takes from the young to subsidize the old. That’s why the White House is so dead set on getting young people to sign up – without our money, the system won’t work, and the exchanges will enter what has been called a “death spiral.”

What’s missing in this political calculus is the realization that young people are the least able to afford to purchase health care. In an era of sky-high student-loan debt (currently more than $26,000 per borrower and rising), 16.1 percent unemployment, and stagnating and even falling salaries, Obamacare is estimated to increase insurance premiums for young people by an average of 169 percent.

Coughing up that much cash isn’t just unaffordable; it’s financial suicidal for a debt-ridden generation struggling to find good jobs.

My generation’s concerns with Obamacare don’t end with the costs. Another sticking point is the law’s “Federal Data Services Hub.” This term is at best a euphemism; the data hub is an enormous database of every participant’s private medical records, tax and financial info, legal history, and other intimate information that we probably wouldn’t want out in the open.

It’s basically an NSA-esque database of TMI – too much information.

And there are way too many hands in this overflowing informational cookie jar. As it stands, local law enforcement, insurance companies, and innumerable federal agencies and low-level bureaucrats will have access to the data hub’s treasure trove of personal information. Even the law’s “navigators” – employees from nongovernmental groups, some of which are politically controversial – will have access to the database’s secrets. It’s an astounding assault on privacy, and it’s no surprise that it’s being challenged in court.

These problems, along with others, have even caused Congress to exempt itself from the exchange. Similarly, unions, corporations and others with political connections have received waivers or extensions from the administration. Not everyone has been so lucky.

Thankfully, millennials do have one remaining option: to opt out of Obamacare. This path allows them to pay a small penalty, which then frees them to purchase health insurance outside of the exchange system. That insurance can be specifically tailored to their individual needs – and it won’t have the drawbacks that make the exchange system so unappealing.

Young people can actually end up saving a substantial amount of money by taking this road. A recent study by the National Center for Public Policy Research estimated that 3.7 million Americans between ages 18 and 34 will save at least $500. A full 3 million will even save as much as $1,000. Opting out of Obamacare is thus an attractive option for millennials, who tend to be healthy and need a greater share of their paychecks in order to make ends meet.

Of course, the alternative is for them to join an exchange system that both picks their pockets and shares their secrets. No celebrity is popular enough to gloss over that.

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