Covering young adults helps hospitals, reduces unpaid bills

What happened after it was legally required to allow young adults to stay on their parents’ insurance? This, of course, is a provision of the Affordable Care Act.

Hospitals were helped because there was less uncompensated care. And those twenty-somethings avoided huge medical bills they could not afford.

That’s the conclusion of a study by the RAND Corporation published in the New England Journal of Medicine. 

“The change allowing young people to remain on their parents’ medical insurance is protecting young adults and their families from the significant financial risk posed by emergency medical care,” said Andrew Mulcahy, the paper’s lead author and a health policy researcher at RAND, a nonprofit research organization. “Hospitals are benefitting, too, because they are treating fewer uninsured young people for emergency ailments.”

Ultimately, covering young adults is good for them and for hospitals, too.

“Our findings show that young adults not only are more likely to have insurance coverage after the provision went into force, but they and hospitals also have improved financial protection,” Mulcahy said. “Because we looked at only the most-serious emergency cases to rule out the influence of insurance on the decision to seek health care, we probably underestimate the full financial benefits that the new rules have provided to young adults who need urgent medical care.”

While this study is about what happened with the parental coverage provision, it should apply to expanding Medicaid to cover low-income working people, certainly including young adults who now don’t have insurance.

Overwhelmingly, those individuals don’t have insurance because their employers don’t offer it and they can’t afford it.

Covering them helps them and provides greater “financial protection” for hospitals.

Amy Fried

About Amy Fried

Amy Fried loves Maine's sense of community and the wonderful mix of culture and outdoor recreation. She loves politics in three ways: as an analytical political scientist, a devoted political junkie and a citizen who believes politics matters for people's lives.