When it’s time to end your parents’ health insurance

The Affordable Care Act has helped to lower the rate of uninsured for twenty-somethings. The Affordable Care Act’s most popular provision allows young adults to remain on their parents’ insurance until the age of 26. I have been blessed to have coverage through my parents’ insurance plan for many years. However, I plan to switch to a Kiplinger plan soon.

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Some insurers allow adult kids to remain on their parent’s plan until their 26th birthday. Others stop coverage at your birthday. You should look for other options if your parents have a plan.

COBRA coverage. COBRA allows you to remain on your parent’s plan until 26. This stands for Consolidated Omnibus Budget Reconciliation Act. The law allows someone who quits their job to stay on their employer’s plan for 18 months. However, young adults who are about age out of their parent’s plan are eligible. Your parent’s employer will need to know that you are interested in COBRA. Once you have done so, you’ll be able to access benefits for up to 36 month. COBRA is costly. While many employers pay the majority or all of the cost for employees’ health insurance premiums (or most of it), COBRA will require you to pay the full premium. According to Karen Pollitz, senior fellow at Kaiser Family Foundation, the average monthly premium for COBRA plans is $600 to $700.

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Your employer may offer health benefits if you are working. This will likely be cheaper than COBRA. You can sign up for insurance now, even if you turn 26 or lose coverage under your parents’ plan.

Affordable Care Act. You don’t have any health insurance through your employer. The Affordable Care Act opened up access to health care for all Americans, even young adults, via the online insurance marketplace.

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  • You may also be eligible for financial aid that will help to significantly reduce the premium cost. In March, the American Rescue Plan was signed into law. It significantly increased ACA subsidies and lowered premiums for all income levels. Some households even got them eliminated. You can purchase silver-level plans with enhanced benefits if your modified adjusted gross income for 2021 falls between 100% and 150% below the federal poverty line ($12,880 to $19320 for a single-person household). To access the state’s health insurance marketplace, select your state. This tool can also be used to determine if you are eligible for Medicaid. Medicaid provides coverage for low-income families.

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  • Students are eligible for coverage. Students may be eligible for student insurance if they are enrolled in graduate school. Mina Schultz is the ACA outreach manager and enrollment manager at Young Invincibles. Young Invincibles advocates for young adults. Although student health insurance can be very affordable, coverage quality can vary. Schultz suggests Medicaid as an alternative for students who are not employed. You may be eligible to enroll in Medicaid if your income is less than $16,000.
  • An ACA Navigator can help you decide which option is right for you. ACA Navigators is a network made up of experts in health care who can assist you with your application for insurance. They may also be able to help you if you are already enrolled in a plan.