Young adults age 19-34 comprise 38.1 percent of the uninsured population.1 In the media, they’re often characterized as uninterested, irresponsible, and obsessed with their favorite social media app. Despite these characterizations, they’ve been a key target group for insurers, especially those participating in the health insurance exchanges (HIX). Health plans are seeking healthier, less costly enrollees to stabilize the risk pool and balance out spending on older enrollees. For the health insurance industry, the federal government, and the states that developed their own exchanges, two key questions have come out of this first HIX open enrollment year: Did we do it right? If not, what can be done better the next time around?
Findings from Deloitte’s survey of young adults and health insurance paint a new picture of this population.2 According to the survey results, health insurance for a sizable segment of this age cohort is simply not affordable. On the whole, this group is cost-sensitive, and when faced with the complexities of choosing coverage, they lack a basic understanding of some important features that make it more affordable. Some may have made up their mind to not even shop for coverage―54 percent of those who remain uninsured never visited HealthCare.gov or one of the state exchange websites.
But, why is this surprising? Many are debt-ridden with some of the highest rates of student loans in history, face first-time employment following the worst recession the U.S. has seen since the Great Depression and have little disposable income. Knowing this, we begin to see how these characteristics have shaped their attitudes and behaviors toward health insurance coverage over the course of the first year of enrollment.
So, what does this population really look like and how do they make decisions regarding health insurance coverage?
They’re not invincible.
A majority of those who remain uninsured (did not purchase insurance) did so for two reasons: they can’t afford it (66 percent) and they do not see its value (46 percent).
Young adults who obtained insurance are aware that they’re not invincible: those who purchased it got it because they want to avoid paying medical bills if they get sick, pregnant, or injured (67 percent). Admittedly, 45 percent decided not to see a doctor or medical professional when they were sick or injured in the prior 12 months because they believed it was too expensive. They also enrolled because it gives them peace of mind that they can get care if they need it (60 percent).
They don’t want bells and whistles.
Brand (43 percent) and provider networks (48 percent) matter less to this population than overall costs (75 percent) and good value (68 percent). These differences were even more pronounced for the older young adults (age 25-34).
They didn’t get the whole story.
Early ads and marketing strategies did a great job of raising awareness for certain aspects of the new law. This was critical for the first year. Most young adults coming out of the open enrollment season were aware that they faced a mandate for health insurance (78 percent) and a fine for not purchasing (74 percent) and they knew about the exchanges as an option for gaining insurance (75 percent).
But they didn’t get one of the most important messages: Only half (55 percent) of all the respondents were aware that the federal government offers money to those with lower incomes to help them purchase health insurance.
Despite consistently being framed as the social-media obsessed generation, there was no dominant source of communication that they preferred. They turned the most to friends and family (42 percent) and health care providers (30 percent) as trusted sources for information. These channels won over media sources and entertainers such as celebrities and sports figures (9 percent). And, despite being traditionally viewed as the most tech savvy group, 28 percent gave up on enrolling after experiencing technical difficulties on the exchange websites.
Bottom line: Young adults are looking for more.
They’re looking for products that are affordable and meet their needs. The same products and features that their older counterparts often look for (e.g., choice, broad networks) may not foot the bill for these young adults. What will the right product look like and will it meet their needs? We have some improvements to make if younger adults are going to be consumers of health care. Affordability will be critical to both lowering the barriers to adoption and increasing their understanding of what the value of good health is. What new, innovative designs, benefits and network considerations can be made to make products more attractive?
They’re looking for a better roadmap. The ads and marketing this first time around got their attention and raised their awareness, but young adults missed out on a key message that help is available in the form of subsidies. The messages also did little to help this population navigate the complexities of health insurance. Going forward, will the health insurance industry be able to engage this group so that they get the information they need in the format they need it? What multi-channel approaches will help make choosing and affording health insurance easier for them to navigate?
Hopefully this information will help shape a new level of discussion between the health insurance industry, policymakers, state and federal regulators and health care providers. If we want everyone to be insured, we need to give people a value proposition they are willing to buy.
Sources: 1Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services, “Overview of the Uninsured in the United States: A Summary of the 2012 Current Population Survey Report,” September 2012;
2Methodology: The Deloitte Center for Health Solutions conducted a web-based survey of 500 randomly selected young adults age 19-34 years; with systematic controls for age, gender, race and ethnicity, health insurance status, household income, and geographic location. To be eligible for participation, respondents met the following criteria: resides in the U.S.; age 19-34 years; uninsured as of September 30, 2013; knows current health insurance status; knows current health insurance source if currently insured; and does not work for the federal government. The survey was fielded between April 9 – April 23, 2014. Data were weighted to be representative of non-institutionalized U.S. adults age 19-34 years. Weighting was applied to correct for bias from using quotas for the insurance groups and for differences between an online panel and the general population.