Colleges across the country are wrapping up the school year and some graduates may be wondering, “Where am I going to get health insurance?”
There are also many parents of college graduates asking, “How is my kid going to get health insurance?”
Regardless of who’s asking, there are options.
Join a parent’s health plan
Under the Affordable Care Act (ACA), since 2010, children can be covered under a parent’s health insurance until age 26 if certain conditions are met. (This has proven to be a popular option.)
What are the conditions? First, the parent’s policy has to allow dependent coverage. Under Wisconsin state law, insurance companies have always been required to offer dependent coverage on individual and group plans. In other states, laws may differ.
If a group or individual plan provides dependent coverage of children, the plan must make that coverage available until a child turns age 26. If your employer offers a self-funded group plan that does not provide coverage for dependents, the employer may be considering this option now because new regulations under the ACA will impose a penalty tax beginning on Jan. 1, 2014, for large employers (with 50 or more employees) that do not offer coverage to employees or their dependents.
Second, if the parent’s insurance is through his/her employer, the child must not have access to his/her own job-based insurance. This limitation goes away on Jan. 1, 2014.
If these criteria are met, the child can generally remain covered by a parent’s policy until he/she turns 26—even if married, financially independent, or not living with the parents. Once the child turns 26, though, that child is off the parent’s policy for good.
Short-term health plans
Another option available for graduates needing to bridge the gap until they land their first “real” job is a short-term health plan. WPS offers the WPS Instant Protection Plan, which provides coverage for 30 to 185 days. Other companies offer short-term health plans as well. It’s a good idea to talk to your insurance agent to make sure you get the right one for you.
Individual health plans
Can’t get on mom’s or dad’s health plan? Then get your own plan! As a young person, if you’re healthy, your chances of securing a health plan on your own are pretty good. Talk to your insurance agent about your options. There are lots of choices and coverage options, so you’ll likely want help figuring out what all of them mean. You can get some help in our Learning Center with common health insurance terms and definitions.
New options in 2014
An option for young adults that isn’t available quite yet is Medicaid. Starting in 2014, if you’re unemployed with limited income up to about $15,000 per year for a single person (higher income for couples/families with children), you may be eligible for health coverage through Medicaid.
Another choice for young adults under age 30 beginning on Jan. 1, 2014, is a catastrophic plan. Catastrophic plans are generally less expensive than traditional individual health plans because they have higher deductibles. Talk to your insurance agent about finding a catastrophic plan that works for you. Catastrophic plans will be available both on and off the exchange; open enrollment begins Oct. 1, 2013.
Find out more