Researchers at the RAND Corporation set out to find some hard data on one aspect of the health law: Does having medical insurance protect young adults from the financial ruin that often comes with a major injury or illness? The quick answer: Yes, it does.
Since September 2010, the Affordable Care Act has allowed young adults to remain on their parents鈥 medical insurance until they turn 26, and an estimated聽 have taken advantage of the new rule.
The RAND researchers looked at nearly a half a million visits young adults made to emergency departments around the country before and after the under-26 provision took effect.
鈥淲e looked at just the most serious conditions,鈥 said Andrew Mulcahy, an associate policy researcher at the RAND Corporation. Mulcahy and his colleagues pored over actual hospital records for bone fractures, poison, traumatic brain injuries, and other incidents that would require an urgent trip to the hospital.
The RAND analysis, ,聽found that the new law resulted in $147 million in hospital bills charged to private insurance companies in 2011.
鈥淪ome of those costs would have been born by individuals,鈥 said Mulcahy. 鈥淪ome of those costs would have been ultimately been born by hospitals as uncompensated care.鈥
Indeed, as might be expected when any uninsured people gain coverage, the young adults insured under their parents鈥 plans were shielded from the potentially catastrophic costs of a medical emergency.
鈥淭hat鈥檚 exactly what the law intended,鈥 said , director of Health Reform and Public Programs Initiative at the non-partisan California HealthCare Foundation.
But the millions of newly insured adults didn鈥檛 come for free, added Mulkey. 鈥淭he cost of covering those people was spread over all the people with similar coverage who paid a little bit more in their premiums,鈥 she said.
Those added premium costs were likely to be fairly low, since young adults consume much less health care and can help to balance out the higher medical bills of their parents and other older workers.
For hospitals though, more insured customers is unequivocally good news, especially when those new customers have private insurance which pays more than Medicare or Medicaid.
One of the goals of the health law was to reduce the number of unpaid hospital bills, said Joseph Antos, a health care policy expert at the right-leaning . To the extent that people sign up for insurance when the online marketplaces open in the fall 鈥 and more young adults continue to sign up on their parents鈥 plans 鈥 that just might work.
鈥淭hen I think we鈥檒l be successful in reducing uncompensated care,鈥 Antos said. 鈥淚n other words, more of those services will be paid fully, and more of those services will be paid at a higher rate than they were before.”
