Millennials should opt out of exchanges

In preparation for the rollout of the Affordable Care Act, the Obama administration is taking its message to UNLV and other college campuses to sign up as many students as possible. They’ve even brought on board Lady Gaga, Jennifer Hudson, Amy Poehler and other celebrities to help convince Millennials that the exchanges are cool.

Apparently they think Millennials are gullible. But no veneer of popularity can mask the exchange system’s deep problems. The exchanges are a bad deal for young people. As a result, it makes more financial sense for Millennials to opt out and purchase a non-Obamacare policy on the private market.

The most obvious problem with the exchange system is how it perversely relies on a system of generational redistribution. The law takes from the young to subsidize the old. That’s why the White House is so dead-set on getting young people to sign up. Without their money, the system won’t work, and the exchanges will enter what has been called a “death spiral.”

What’s missing in this political calculus is the realization that young people are the least able to afford health insurance. In an era of sky-high student loan debt (currently more than $26,000 per borrower and rising) and 16 percent youth unemployment, Obamacare is expected to increase insurance premiums for young people by an average of 169 percent.

Coughing up that much cash isn’t just unaffordable, it’s financially suicidal for a debt-ridden generation struggling to find good jobs.

This generation’s concerns with Obamacare don’t end with the costs. Another sticking point is the law’s Federal Data Services Hub, an enormous database of every participant’s private medical records, tax and financial information, legal history and other intimate information we probably wouldn’t want out in the open.

It’s an NSA-like database of TMI — too much information.

And there are way too many hands in this overflowing informational cookie jar. As it stands, local law enforcement, insurance companies and innumerable federal agencies and low-level bureaucrats will have access to the Data Hub’s treasure trove of personal information. Even Obamcare “navigators” — employees from nongovernmental groups, some of which are politically controversial — will have access to the database. It’s an astounding assault on privacy, and it’s no surprise that it’s being challenged in court.

These problems, along with others, have caused Congress to exempt itself from the exchange. Similarly, corporations and other groups with political connections have received waivers or extensions from the Obama administration. Not everyone has been so lucky.

Thankfully, Millennials do have one option: Opt out of Obamacare. This path allows them to pay a small penalty and frees them to purchase health insurance outside the exchange system. That insurance can be specifically tailored to their individual needs — and it won’t have the drawbacks that make the exchange system so unappealing.

A recent study by the National Center for Public Policy Research estimates that 3.7 million Americans from age 18 to 34 would save at least $500 annually by taking this road. A full 3 million would save as much as $1,000 annually. Opting out of Obamacare is thus an attractive option for Millennials, who tend to be healthy and need a greater share of their paychecks to make ends meet.

The alternative is joining an exchange system that picks their pockets and shares their secrets. No celebrity is popular enough to make that appealing.

Evan Feinberg is president of Generation Opportunity, a national nonpartisan organization advocating economic opportunity for young people through less government and more freedom.