Health and Science

New push to enroll young adults and other uninsured in Obamacare health plans

Alina Nurieva (R) sits with Gabriela Cisneros, an insurance agent from Sunshine Life and Health Advisors, as she picks an insurance plan available in the third year of the Affordable Care Act at a store setup in the Mall of the Americas in Miami, Florida.
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The Obama administration on Tuesday announced new tactics to push young adults without heath insurance and other remaining uninsured people to sign up for Obamacare plans starting this fall.

Those tactics are specifically designed to improve the financial strength of insurance plans being sold on the Obamacare marketplaces, while at the same time increasing health coverage of younger adults, who have continued to have higher uninsured rates than other age groups despite an overall reduction in the nation's uninsured rate.

The tactics include reaching out directly via mail to the millions of uninsured people who the federal government knows paid an Obamacare tax penalty this year for not having health insurance last year, and people who claimed an exemption from the law obligating most Americans to have some form of health coverage.

About 45 percent of the people who paid a penalty or claimed an exemption for 2014 were under the age of 35, compared to just 30 percent of all taxpayers that year.

The Obama administration also said it will do "smarter outreach" during the next open enrollment by emailing people to prompt them, nearly immediately, to complete an application for health coverage, or select a health plan and pay their first month's premium if online enrollment systems show that they have paused in finishing such tasks.

Other emails will be timed to be sent just before certain key enrollment deadlines, which officials have said have proved to be a strong motivator for younger adults to sign up.

And the administration said it is taking steps to encourage insurers to help young adults turning age 26 to transition off of coverage under their parents' health plans into Obamacare coverage sold on government exchanges. The Affordable Care Act allows people under 26 to be covered by their parents' plans, and data show a marked uptick in the uninsurance rate of people who turn 26.

Finally, the administration announced several partnerships to boost enrollment by young adults. They include a deal with ride-hailing service Lyft, which will offer discount codes for people using Lyft to travel to open enrollment events where they can get help signing up for Obamacare plans.

"With these steps, we're going to start our open enrollment strong," said Sylvia Burwell, secretary of the U.S. Health and Human Services Department, which oversees Obamacare. "And we're going to leave our marketplace stronger" for people in the future, she added.

Obamacare's fourth open enrollment season begins Nov. 1. It will end Jan. 31. Obamacare plans are sold on, the federally run marketplace, as well as by state-run exchanges. People can also buy individual health plans outside of those markets, through a broker, privately run exchange, or from insurers themselves.

The penalty for not having some kind of health coverage in 2017 will be the higher of 2.5 percent of household income or about $695 per adult.

Tuesday's announcement was the last in a series of three HHS has made this month with an eye toward boosting enrollment in Obamacare plans, and toward increasing the strength of the so-called risk pool of those plans. The other moves were tied to the use of short-term health insurance that doesn't comply with Obamacare rules, and funding that could help state insurers hold down premium increases next year.

Plans with weak risk pools have a disproportionate share of customers who are costing the plans more in health benefits claimed than they are paying in monthly premiums. Plans with strong risk pools are taking in enough premiums to more than cover their costs for paying for covered benefits, while earning insurers some profit.

A number of insurers are asking for double-digit percentage increases for their Obamacare plans based on the argument that their risk pools have been weaker than anticipated.

Tuesday's announcement reflects the fact that younger adults tend to be, as a group, healthier than older adults, and less apt to use health benefits that can drain money out of insurance plans.

If the initiative works, and more younger adults enroll, it could help control premium rate increases in future years.