How Millennials Are Messing Up Obamacare

A batch of much-anticipated Obamacare enrollment numbers were released Monday, and for the White House, they contain a bit of disappointing news: Out of the estimated 2.2 million* people who’ve bought health insurance through the Affordable Care Act’s state or federal exchanges, only around 24 percent are between the ages of 18 and 34. That’s by no means a death blow for the law, but it’s short of the Obama administration's goal, and has the potential to drive up insurance premiums for everyone enrolled through the exchanges.

The Affordable Care Act, and health insurance in general, is based on the premise that both healthy and not-so-healthy people buy coverage; that way, healthy folks’ premiums help subsidize the cost of providing care for the not-so-healthy. (This, in part, is why the law has an individual mandate.) Generally speaking, younger people need less care than older folks, and so in order for premiums in general to remain low, a lot of young people have to buy into the program.

The administration had hoped that, if it hit its goal of 7 million enrollees, 40 percent of those enrollees would be between 18 and 34. It hasn’t hit that goal yet, but according to numbers released today by the Department of Health and Human Services, only 24 percent of the current enrollees so far are in that demographic. That’s not terrible, but it raises the possibility of higher premiums for everybody if more young people don’t enroll soon.

There’s a big caveat here, though, one that the law’s supporters and detractors need to keep in mind: Historically, young adults wait until the last minute to buy health insurance.

That’s what happened in Massachusetts, which introduced a similar health care plan under Mitt Romney’s governorship. In Massachusetts, young enrollees increased steadily month by month after the new insurance system was unveiled, rising from 15 percent of enrollees in the first month to over 31 percent a year into the new program. Right now, the Obamacare exchanges have been open for three months; three months after the Massachusetts system was introduced, only 22 percent of enrollees were young adults, which is slightly lower than where we’re at with the federal exchanges.

Obamacare’s open enrollment lasts until March 31st, so there’s plenty of time for young adults to buy insurance. If history is any guide, they’ll do so in higher numbers over the course of the next couple of months than they have thus far; in fact, that trend has already been bourn out since the exchanges opened in October:

And so, while today’s report is a slight disappointment for proponents of the law, it isn’t as catastrophic as Obamacare opponents will inevitably make it out to be.

*This is the official White House estimate, but it doesn’t include people who, thanks to Obamacare, were newly eligible for Medicaid coverage. An exhaustive but unofficial estimate by an outside tracker pegs total current enrollment at 9.8 million.