Health insurance coverage poses a financial challenge to many young people. Although they may enjoy good health, insurance can be costly, and not all employers offer coverage or pay the full cost. However, young adults have an extended period where they can remain on a parent's policy even if they no longer live at home. The Affordable Care Acts requires insurance companies to maintain coverage on family plans for children and dependents up to age 26.
The Affordable Care Act mandates that insurance companies must offer or extend coverage for dependents on a family health plan until the dependent turns 26. Commonly referred to as ObamaCare, the law does not set controls on the premium amount, nor does it require insurance companies to offer this coverage on plans that didn't already have dependents. A family plan may cover all dependents for a fixed price, or the policyholder may select dependents to be covered as an option. In either case, the insurance company may not delete a dependent from coverage until he turns 26.
The law applies to all health insurance policies, whether or not they are purchased through the health insurance exchanges set up by the Affordable Care Act. The extended coverage must be offered even if the dependent works and has coverage available through his employer. Living away from home, or in school, or being financially independent from parents or guardians does not disqualify someone for the mandated offer of extended coverage.
Special Enrollment Periods
On a dependent's 26th birthday, mandated coverage ends. This begins a 60-day special enrollment period when an individual who has lost coverage can seek out his own coverage, either through an exchange or directly through an insurance company or broker. Certain other life events -- such as having a baby, adopting a child or getting married -- enables anyone to enroll in a plan outside of the open enrollment period that begins for a limited time each fall.
Losing and Gaining Coverage
If a dependent was dropped from a family plan, but is still under 26, they can be added back on the plan during the open enrollment period. If a dependent is already eligible for a parent's job-based coverage, but wants to shop for his own plan, the law allows him to claim the tax credits that will lower premium costs for individual insurance. If a child can't be claimed as a dependent, however, he can claim the tax credits even if he's eligible for coverage under a parent's insurance.
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