Democrats & AARP exploit young adults
by Brian T. Schwartz | 1:30 am, November 26, 2009 | Comments Off
Excerpts from Robert Samuelson’s “Health ‘Reform’ That Burdens Our Young” in Newsweek:
One of our long-running political stories is the economic assault on the young by the old. …This makes no sense for the nation, but as politics it makes complete sense. The elderly and near elderly are better organized, focus obsessively on their government benefits and seem deserving.
In fiscal 2008 … Social Security, Medicare and Medicaid (programs wholly or primarily dedicated to the elderly) totaled $1.3 trillion, 43 percent of federal spending and more than twice military spending. Because workers, not retirees, are the primary taxpayers, this spending involves huge transfers to the old.
Now comes the House-passed health-care “reform” bill that, amazingly, would extract more subsidies from the young. It mandates that health insurance premiums for older Americans be no more than twice the level of that for younger Americans. That’s much less than the actual health spending gap between young and old. …
Not surprisingly, the 40-million-member AARP, the major lobby for Americans over 50, was a big force behind this provision. …
AARP lobbyists scramble to shift their members’ costs onto younger generations. For example, the House health legislation improves Medicare’s drug benefit. That would help the half of AARP members who are over 65. The other half, those between 50 and 64, could benefit from the skewed insurance premiums.
… A single person 55 to 64 might save $3,490, estimates an Urban Institute study. By contrast, single people in their 20s and early 30s might pay about $600 to $1,100 more. For the young, the extra cost might be larger, … the House bill would require them to purchase fairly generous insurance plans rather than cheaper catastrophic coverage that might better suit their needs.
AARP justifies the cost-shifting as preventing age discrimination. Premiums based on age should be no more acceptable than premiums based on medical expenses reflecting race, gender or preexisting health conditions, it says. …
This is unconvincing. All insurance aims to protect against risk—but within groups facing similar risks. Put differently, most insurance is risk-adjusted. Auto insurance premiums vary by age; younger drivers pay higher rates because they have more accidents. Homeowners’ policies for similar houses cost more in high-crime areas. This is not “discrimination”; it’s a reflection of risk and cost differences. Insurers that ignored these differences would soon vanish because they’d suffer heavy losses and lose customers.
Read the whole article: Health ‘Reform’ That Burdens Our Young.
(Via FIRM)
