- The Washington Times - Tuesday, December 17, 2013

A new report by the nonpartisan Kaiser Family Foundation says is it important that “young invincibles” enroll in the new insurance markets tied to Obamacare, but maybe not as important as many seem to think.

Skeptics have warned of a “death spiral” for the new national health law if too few younger Americans sign up to offset the older and sicker populations that are expected to quickly take advantage of the new law to obtain coverage.

The Affordable Care Act prohibits insurers from basing their premium rates on health status — such as having a preexisting medical condition —or by gender.

It also restricts the variance of premiums based on age. Now, insurers can charge older consumers more than younger ones by no more than a three-to-one ratio, in place of a gap that reached five-to-one.

This, combined with the ban on medical underwriting that rejected sicker enrollees in past, caused many people to worry that premiums would spike due to Obamcare.

The Kaiser report said about 40 percent of enrollees would have to be younger, healthier adults — for example, 2 million young enrollees if about 5 million people sign up for private coverage through Obamacare by March 31 — to balance out rate hikes on the market places.

Kaiser analysts simulated a few scenarios, however, that suggest premiums will not skyrocket even if young-adult enrollment falls below this goal, because insurers will still be able to turn a profit.

“Enrollment of young adults is important, but not as important as conventional wisdom suggests, since premiums are still permitted to vary substantially by age,” the report says. “Because of this, a premium ‘death spiral’ is highly unlikely.”

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