4 of 10 Americans would rather pay fine than buy insurance, survey says

Roughly 40% of American adults would choose to pay a financial penalty rather than purchase health insurance, according to a new poll commissioned by InsuranceQuotes.com.

Notably, however, 65% of respondents between the ages of 18 and 29 indicated that they would purchase insurance, a greater proportion than any other age group.

The survey posed a hypothetical scenario to respondents based on the requirements of the Patient Protection and Affordable Care Act. They were asked to assume that they were a 45-year-old individual earning $50,000 per year. Insurance coverage would cost $3,000 per year, or they could pay a fine of $400 (equal to 1% of their income above $10,000). Which would they choose?

Overall, 59% of respondents indicated that they would purchase insurance, while 38% preferred to pay the fine. Those figures were nearly identical for men and women, but there were significant differences between other demographic groups, including among age cohorts.

“We hear so much about the young invincibles,” said Laura Adams, senior insurance analyst with insurancequotes.com. “They typically are the group that we would think would say, 'Sure I'll pay the fine.'”

The contrary results of the survey bode well for the rollout of the federal and state insurance exchanges, which signed up roughly 365,000 individuals in the first two months of operations. That's because the success of the federal healthcare law hinges in large part on convincing younger, predominantly healthy individuals to purchase coverage so that insurers will end up with a balanced risk pool.

The Obama administration and state exchange officials have shared very little information so far on the age distribution of the enrollees.

The insurancequotes.com survey also showed widespread knowledge of a key provision of the federal healthcare overhaul: the individual mandate. Just over 70% correctly indicated that the law requires individuals to have coverage in 2014 or face a fine. Only 19% expressed a belief that there was no such requirement in the law.

But the public remains widely ignorant about other provisions. For example, nearly 80% of respondents wrongly indicated that children are exempt from the federal insurance requirement.

The phone survey was conducted by Princeton Survey Research Associates International from Nov. 14-17. Nationwide there were 1,013 respondents.

Follow Paul Demko on Twitter: @MHpdemko