Opinion: Age tax for health insurance is unfair and unaffordable

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Troy deChabert Schuster
AARP VI State Director

Recently, members of Congress introduced a bill designed to allow insurance companies to create a scale that would charge older workers five times what other consumers pay for the same health insurance policy. Supporters of the bill call it “age rating.” They can call it whatever they want, but the truth is it’s an unfair tax on older workers that would line the pockets of big insurance companies.

This legal form of discrimination is priciest for workers age 50 to 64, who are still too young for Medicare. Under HR 708, “The State Age Rating Flexibility Act of 2017,” the average 60 year-old would pay more than $3,000 per year in health insurance premiums, according to an AARP-sponsored analysis. Their insurance premiums could reach up to over $17,900 year. That is outrageous and it is why AARP is opposing this unfair age tax.

If this bill becomes law, it could potentially force Virgin Islanders age 50 to 64 to dig a lot deeper into their pockets to pay for health insurance.

Even now, many Virgin Islanders in the age 50-64 range are hard-pressed to handle their health care bills, and are no better able than other consumers to absorb a jolt in this expense. The economy may be improving, but who is in a position to absorb an insurance premium increase of more than $3,000?

And it wouldn’t just be individuals picking up the tab. Further weakening the consumer protection on age rating would ratchet up the government’s own health care costs. AARP researchers have found that if the age tax was increased, taxpayers of all ages would have to spend an extra $6.7 billion in assistance for older Americans who need extra help.

As part of the Affordable Care Act the current cap, for those with existing private health insurance policies, limits insurers to charging older consumers no more than three times the amount charged to younger consumers. Since enactment of the ACA, the number of uninsured Americans age 50-64 has fallen in half – a real achievement that deserves far more attention.

Instead of increasing profits for insurance companies, AARP believes Washington should focus on reducing health care costs for everyone. A good example of this would be by cracking down on drug companies’ high prices.  For instance, Congress could pass legislation to allow Medicare to negotiate with drug companies for lower drug prices.  And, legislators could reduce barriers to global price competition by allowing for the safe importation of lower-priced drugs. There is no reason for Americans to continue paying the highest prescription drug prices in the world.

On behalf of our 22,000+ members in the Virgin Islands, AARP is committed to working with elected officials of both parties to find responsible solutions for the problem of rising health care costs. If you agree that it is a bad idea to force our mid-life consumers to pay thousands of dollars more for their care, please contact our Delegate to Congress, Stacey Plaskett, at 340-774-4408 or 340-778-5900 and ask her to use her influence to get her colleagues to vote a resounding “No” on the American Health Care Act.

About AARP
AARP is a nonprofit, nonpartisan organization, with a membership of nearly 38 million, that helps people turn their goals and dreams into real possibilities, strengthens communities and fights for the issues that matter most to families such as healthcare, employment and income security, retirement planning, affordable utilities and protection from financial abuse. We advocate for individuals in the marketplace by selecting products and services of high quality and value to carry the AARP name as well as help our members obtain discounts on a wide range of products, travel, and services.  A trusted source for lifestyle tips, news and educational information, AARP produces AARP The Magazine, the world’s largest circulation magazine; AARP Bulletin; www.aarp.org; AARP TV & Radio; AARP Books; and AARP en Español, a Spanish-language website addressing the interests and needs of Hispanics. AARP does not endorse candidates for public office or make contributions to political campaigns or candidates.  The AARP Foundation is an affiliated charity that provides security, protection, and empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. AARP has staffed offices in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. Learn more at www.aarp.org.

About the AARP Foundation
AARP Foundation is working to win back opportunity for struggling Americans 50+ by being a force for change on the most serious issues they face today: housing, hunger, income and isolation. By coordinating responses to these issues on all four fronts at once, and supporting them with vigorous legal advocacy, the Foundation serves the unique needs of those 50+ while working with local organizations nationwide to reach more people, strengthen communities, work more efficiently and make resources go further. AARP Foundation is AARP’s affiliated charity. Learn more at AA.