How Obamacare, Like Medicare, Royally Screws Young People

So Rep. Nancy Pelosi (D-Calif.) is "ecstatic" over today's Supreme Court ruling that the Affordable Care Act, a.k.a. Obamacare, has passed constitutional muster. As are many others.

But the youngsters out there, especially those who bought into President Obama's message of hope and change, should make sure they understand how his signature achievement is going to screw them even more royally than Medicare already does. Avik Roy at Forbes lays it out thus:

Obamacare forces insurers to charge their eldest beneficiaries no more than 3 times what they charge their youngest ones: a policy known as "community rating." This, despite the fact that these older beneficiaries typically have six times the health expenditures that younger people face. The net effect of this "community rating" provision is the redistribution of insurance costs from the old to the young.

That's for premiums in the much-discussed and yet-to-be realized government exchanges for health care. The same principle is already at work to various degrees in community rating pools for workplace-provided insurance.

In the August/September issue of Reason (on newsstands now but not yet online), I've co-authored a piece about "Generational Warfare" with Veronique de Rugy in which we document the ways in which the old-age entitlements of Social Security and Medicare systematically loot the relatively young and relatively poor to pay benefits to the relatively old and relatively rich. Obamacare is simply the latest variation on that awful dynamic.

Nick Gillespie is co-author with Matt Welch of The Declaration of Independents: How Libertarian Politics Can Fix What's Wrong With America, now out in paperback with a new foreword.