Under federal health insurance legislation, children in the United States can be covered by their parents’ health insurance plans until they are 26, but that doesn’t mean that coverage automatically ends on their 26th birthdays. There is a window of opportunity to make decisions about health insurance.
Young adults approaching their 26th birthdays and their parents would do well to learn some basic facts about health insurance, and look clearly at all the options open to them. At Health Choice One, we’re ready to help you all along the way.
When parents’ health insurance ends
Under the Affordable Care Act (usually known as “Obamacare”), children can be covered by their parents’ health insurance plan up to age 26. This applies whether or not the children are financially dependent on their parents, living with their parents, attending school, married or eligible to join their employers’ health insurance plans.
When to take kids off your plan
Parents of adult children may be tempted to remove them from their health insurance plan when they turn 26, but before they do that, they should consider the situation and consequences.
Even young, healthy people can encounter high medical bills. Half of uninsured young people report having trouble paying their medical bills.
Some states allow coverage to extend up to age 30 or 31, with some limitations.
- For example, in New York, children can stay on their parents’ plan up to age 30 or until they marry.
- In New Jersey, it’s up to age 31 for unmarried children with no dependents of their own.
What happens on your 26th birthday?
Coverage does not end automatically on your 26th birthday. If you are covered under parents’ group health plan, you are covered until the end of the month in which you turn 26. Some plans cover adult children until the end of the year when they turn 26. Check the terms of your policy to find out the actual date.
Options
- Buy your own plan through the ACA: No matter when your birthday happens, you have a 120-day special enrollment window when you can buy a new health insurance policy on the ACA marketplace. This begins 60 days before you turn 26 and ends 60 days after, giving you four months to shop around, consider your options and sign up.
- Buy a plan outside the ACA: you have until 30 days after your 26th birthday.
- Join your employer’s health plan.
- Join your spouse’s health plan if you are married or in a common-law relationship.
- Choose a “catastrophic” plan — these have low premiums but very high deductibles. They will pay major health care expenses and some preventative treatments as required under law, but you’ll pay for most doctor visits and other treatment out of pocket. They’re only recommended for healthy, young individuals.
You can also buy a temporary health insurance plan under COBRA for up to 18 months. COBRA stands for Consolidated Omnibus Reconciliation Act. It was passed by Congress to provide coverage for people who quit their jobs, are laid off, or without health insurance, divorced or separated from the partner with coverage, or because of other circumstances beyond their control.
While it can provide health insurance for up to three years, it is expensive and it has limits. It lasts for a maximum of 18 months, but you can request an 18-month extension if you or a dependent is disabled.
Don’t cheap out on health insurance
Don’t go for the cheapest premiums just because you’re young and healthy. One in six young adults has a chronic illness, such as diabetes, asthma or cancer.
What’s more, no one can predict the future. Even young, healthy people can have an accident or severe, unexpected illness.
To help make the right decision, give us a call at Health Choice One. We’ll help you wade through all the options and requirements to find the health insurance plan that fits you best.