The Obamacare House of Cards is Collapsing

Obamacare is an impressive house of cards. Its intricate layers of carefully coordinated policies sway precariously in the winds of website failures and actuarial miscalculations. But most worrisome, especially to its Obama administration architects, is that the entire edifice rests atop a wobbly foundation of youth participation.

In the years since the bill’s passage President Obama has done his best to distract everyone from the shoddy underpinnings of this health care house of cards. But following the disastrous unveiling of the online exchanges the whole edifice began to wobble.

The exchanges—the websites designed to give consumers an online shopping experience on par with sites like Amazon—are unworkable. Insiders have described a nightmare experience where last-minute requests from the White House bogged down the system, programmers were huddled in late-night, energy-drink-fueled sessions to fix coding problems, and government bureaucrats, not private tech experts, were responsible for oversight and testing. The result is a website so problematic that some experts are recommending scrapping the whole thing and starting over from scratch.

Even if the tremors of a malfunctioning website can be calmed, the ground-shaking policy choices made in Obamacare will prove to be too much. Unless drastic changes are made to make the law fairer for young adults, the house of cards could collapse.

The foundational problem is that the bill was constructed in a way that would inevitably increase the price of insurance for most consumers. In an attempt to counterbalance those higher costs the Obama administration sought to get more young, healthy, and—most importantly—cheap-to-insure people to purchase coverage. By their own calculations they need 2.7 million of the hoped-for 7 million new enrollees to be under the age of 35. But getting young adults to purchase Obamacare is a tough sell for several reasons.

First, the law reduces insurance companies’ ability to factor age into the costs of their plans. This means that older adults, who are about six times more expensive to insure, can only be charged three times what a younger person may be charged. In essence this forces the younger generations, who are on average poorer, to subsidize older, wealthier ones.

Second, Obamacare forces young adults to buy richer insurance benefits than they may need or want. Even young people with no illness or injury history, who simply don’t use many (if any) medical services, are forced into one of Obamacare’s expensive cookie-cutter plans. This is one of the main reasons why millions of Americans are receiving notices from their insurers that their plans are being canceled. So much for President Obama’s promise that “if you like your health care plan, you can keep your health care plan. Period.”

One of the biggest worries is the enormous financial drain it is causing for a generation already struggling to make it in Obama’s economy. Obamacare’s bevy of mandates, taxes and regulations are driving up premium costs for 18-29 year olds by more than 300 percent in some states. And while many analysts thought the cost spike would be felt most keenly by young men, a new study shows that healthy young women will also see their premiums rise by an average of almost 200 percent.

Those dramatic spikes are especially problematic given the dire state of youth employment. More than 4 million young people under age 30 remain unemployed and millions more are stuck in dead end jobs with low pay, few benefits and no future prospects. The problem is especially acute among adults aged 18 to 24, where 14.8 percent young men and 10.8 percent of young women remain unemployed.

Sadly, fixing this faulty foundation is more difficult than simply creating jobs. Resume gaps, lower starting salaries and toiling in part-time work can put a damper on wages for decades into a career. As a result, some analysts project that young Americans stand to lose an incredible $20 billion in earnings over the next decade.

With young adults being shaken by higher insurance costs, a balky website, fewer jobs and reduced pay, the Obamacare balancing act will only get harder. Unless enough young people find the patience to navigate the labyrinthine law and the money to pay for more expensive coverage the house of cards could soon collapse. The question then becomes, can we build something better and stronger in its place.