WASHINGTON -- Millions of millennials who have gone uninsured in the past because they say it's too expensive face painful choices this year as the sign-up deadline approaches for President Barack Obama's health care law.
With fines for being uninsured rising sharply in 2016, averaging nearly $1,000 per household, those in their 20s and 30s are taking a hard look at whether they can squeeze in coverage to avoid penalties. Many are trying to establish careers or make progress in a still-bumpy economy.
"There's only so far one can dwindle a ramen-noodle diet," said Christopher Rael of Los Angeles. In his late 20s, Rael is pursuing a degree in sociology and working at a children's center to pay his bills.
With open enrollment ending Sunday, Rael is hoping his meager income will qualify him for Medi-Cal, the state's version of Medicaid.
"I cannot afford an additional bill," he said. He paid a fine of about $150 for being uninsured in 2014.
The minimum penalty has risen to the greater of $695 or 2.5 percent of taxable income for someone uninsured a full 12 months and ineligible for one of the law's exemptions. That's more than double the corresponding figure of $325 for 2015.
Fines are collected through the tax returns of uninsured people and in most cases deducted from their tax refunds. The penalty amounts will be increased by a cost-of-living factor in future years.
Penalties are the health care law's nudge to get healthy people into the insurance pool, helping keep premiums manageable for everyone.
Until now, the administration has mainly stressed the benefits: subsidized premiums and protection from the costs of unanticipated injury or serious illness. But with concerns that many young and healthy people still aren't sold, officials are invoking the threat of penalties.
"The tax penalty is bringing more young and healthy consumers into the market," Andy Slavitt, head of the Centers for Medicare and Medicaid Services, said in a recent speech. "We are using a large portion of our marketing resources to make sure that consumers are aware of the increasing fee for people that go without insurance."
Slavitt's agency oversees the health care law.
The pressure of rising fines is butting up against the economic situations of uninsured people, nearly half of whom said in a recent Kaiser poll that they've tried but that coverage is still too expensive. One concern has to do with high deductibles for many health-law insurance plans, which can leave consumers with thousands of dollars in medical bills.
Christina Loucks of Franklin, Tenn., a city near Nashville, said the way she figures it, she might still come out ahead financially by paying a $695 fine.
The insurance plans she's looked at would cost her about $100 per month in premiums, after subsidies. That works out to about $1,200 per year. But the coverage comes with deductibles of several thousand dollars. If she got seriously ill, she would be on the hook for that before her insurance started paying. Normally, she just goes to the doctor for allergy prescriptions.
"I still see it as I am keeping $500 in my pocket," Loucks said. The $500 is the approximate difference between a full year of premiums and the fine for being uninsured, and that calculation might work if she stays healthy.
In her 30s, Loucks is holding down two jobs as she tries to find a career that aligns with her interest in literature. She's still dealing with student loans, not to mention rent and car payments.
"I don't see the benefit for me," she said.
Loucks said she may wait until the last minute to make up her mind, but Julian Rostain said he has decided he'll take a chance on being fined by the Internal Revenue Service.
In his 20s, Rostain works as a cook at a country club. His dream is to open up his own establishment, serving up "American-French bistro food with Asian undertones." He lives in Kennett Square, Pa., a farming area not too far from Philadelphia.
Rostain's savings in a rainy-day fund wouldn't allow him to qualify for expanded Medicaid, and he said he doesn't think he can cover insurance premiums on his budget.
"Do you really think people who can't afford health care should have to pay a penalty?" Rostain said. The law does offer a low-income exemption, and he's checking into it.
"We are talking about paying premium prices for underwhelming health care," said D.J. Byrnes, a sports blogger from Columbus, Ohio, who is in his 20s and uninsured. "If I want to buy something, I want to make sure it's quality."
Information for this article was contributed by Eric Carvin of The Associated Press.
A Section on 01/27/2016