Millennials and Health Insurance
Millennials now make up a good portion of the workforce. The eldest of the Millenials are closing in on age 40, with the youngest being close to age 24. This means that they are generally as healthy as they'll ever be; however, they will soon be experiencing the health problems that begin with middle age.
Many millennials use the health care system differently than older consumers. Those differences can be important factors when choosing a health care plan. Understanding your options, insurance usage, budget, and health priorities can help you make choices for your health care and adjustments as you age.
Even younger, healthy people develop ailments, catch diseases, or have accidents. The key benefit of acquiring insurance when you're young is that you'll find the monthly cost of insurance more affordable than it is when you are older. If you are uninsured, or underinsured, you might consider finding some health coverage that will assist with the costs that increase with age.
Think About Your Typical Health Insurance Usage
Start by taking a look back at the last few years of your life to get a sense of your typical medical needs, or needs you might develop in the future:
- How many times did you go to the doctor, a clinic, or an emergency room?
- How many times did you want to go, but didn’t because of cost concerns?
- How much did you spend on prescription drugs, and do you take any on an ongoing basis?
- Did you have any injuries that are known to cause problems later in life?
Consider what you might need in the next year. Perhaps you’re thinking about starting a family or getting physical therapy for your hamstrings. Try to be honest with yourself about your health, don't ignore your health problems, and decide whether you might need insurance—or more coverage—in the near future.
The cost of healthcare is a concern; however, the costs of not having insurance can be much higher if something happens.
According to research from the Transamerica Center for Health Studies (TCHS), 60% of Millennials that do not obtain health insurance do so because of the costs.
Learn the Terminology
The majority of Millenials are outside of the age limit for coverage on their parent's insurance plans. With this in mind, it is important to understand the basic differences between high and low deductible plans, health maintenance organizations (HMOs), and preferred provider organizations (PPOs) along with many other different kinds of providers and insurance offerings.
Copays (the flat fees you pay for services before the insurance kicks in), coinsurance (the percentage you pay after you meet your deductible), and out-of-pocket maximums are important terms to learn, also. The health insurance and care terms are numerous—knowing them, and how they apply to you can help you decide what type of coverage you need and are able to afford.
Set Your Health Insurance Budget and Shop Around
As with any new expenditure, calculate how much you can pay each month, and then ask yourself how much you’re willing to pay.
Health insurance costs have been volatile in recent years. You can get an idea of what it will cost you to get coverage by comparing offerings at the national healthcare exchange, Healthcare.gov; or at a private online exchange such as eHealth. (Your state may have its own healthcare exchange, but you can start with Healthcare.gov.)
Given your age—assuming you're fit and live a low-risk lifestyle—opting for a high-deductible plan might help you keep your premium costs (monthly payments) down. If you're under age 26, current law allows you to stay on your parents' policy, but that doesn't mean it's the best option available to you.
Addressing your insurance needs should be done annually, at a minimum. A significant life change should also trigger a look at your health insurance needs.
Conduct your due diligence to find the best price and coverage for your circumstances by comparison shopping. When you turn 26, you have 60 days to get your own insurance coverage if you’re still on your parent’s plan. Generally, if your employer offers one, it might be the most cost-effective plan you can get.
However, some employers are passing off much of the cost to employees—you might do better on your spouse’s plan or by shopping independently. If you don’t have employer-based coverage, you may be eligible for a subsidy or the Healthcare.gov exchange.
Prioritize Convenience in Your Health Insurance Plan
Millennials are more likely to be self-employed or freelance workers, and less likely to have a regular primary care physician. They tend to prefer to use retail clinics, urgent care centers, and emergency rooms.
If this is your preference, look for a plan that covers those costs. You can also check for plans that offer a form of telemedicine or electronic communication for minor ailments. Industry leaders include Teladoc, Doctor on Demand, and American Well.
Telemedicine is a newer form of medical practice using technology such as video chatting between doctors and patients.
Consider, as you age, the cost differences between being covered by insurance or not. If you are hospitalized over-night, your care costs can skyrocket if you have no insurance. Your needs will also change as you age—you'll possibly be going to the doctor more—frequent visits may make retail clinics and urgent care centers less affordable than health insurance.
Having a primary care physician with insurance assures continuity of care and familiarity with your health, which makes long-term health care easier and less expensive as your doctor already knows you and your medical history.
Consider Your Use of Prescriptions
In the United States, prescription costs are higher than anywhere else in the world, and costs are rising. You will want to save on prescriptions, especially if you use expensive medication regularly. You can save a significant chunk of change if your prescriptions are covered by your plan since many insurance plans don’t cover prescription drugs until after you meet your deductible.
If you’re spending more than $50 a month on prescriptions, it might be worth looking into plans with lower deductibles.
If you’re shopping for the lowest possible monthly premium, you’ll find catastrophic health care plans on the exchanges. While the price of these plans is appealing, one caveat is that there are very high deductibles, while only covering emergency care and a few other essentials.
Health Insurance in a Changing World
You're more likely to ignore minor health problems in hopes that they'll go away. Many minor health issues get worse, becoming much more expensive to treat—and there are circumstances beyond control that can cause expensive treatments.
By going without health insurance, you assume that you will not become injured, disabled, or seriously sick. Viruses that may not have traveled far in the past are sweeping across the planet due to the modern global economy and availability of quick travel. Hospitalization and testing for these viruses can cost tens of thousands of dollars when uninsured.
The time to find health insurance is not when you have a health problem or there is a health crisis occurring—pre-existing conditions generally cause a denial of coverage or larger monthly premiums compared to someone without them. Having health insurance before something happens can keep your health care spending down and alleviate the stress and danger of not treating health problems.
Transamerica Center for Health Studies. "Millenials: Digital Natives Disrupting Healthcare." Accessed Mar. 19, 2020.
Inmaculada Hernandez, PhD; Alvaro San-Juan-Rodriguez, PD; Chester B. Good, MD; et al. "Changes in List Prices, Net Prices, and Discounts for Branded Drugs in the US, 2007-2018." Accessed Mar. 19, 2020.