Under the ACA (sometimes known as Obamacare), young people are able to stay on their parents’ insurance for a much longer period of time. This is great news because many are choosing to follow drastically different career paths than their parents. Very often, these life trajectories don’t come with the employer sponsored health insurance enjoyed by previous generations. Fortunately there are several low cost health insurance options that will provide coverage without breaking the bank.
ACA & Turning 26
Under the ACA, you are able to stay on your parent’s plan until you turn 26. If your parents have a marketplace plan, you will actually be able to keep your coverage until December 31st of that year. So, if your birthday is January 1st, congratulations, you basically get a whole extra year of coverage! However, if your parents have employer sponsored health insurance, you need to double check this with your state and your specific plan. Sometimes you will lose coverage at the end of your birth month. Sometimes you may be able to apply for an extension. And in some states (such as New York), you may have a few more years before you age out.
You can stay on your parents’ plan even if you do not live at home and are not claimed as a tax dependent. Also your parental or marital status do not affect your eligibility. You can find the full details on healthcare.gov. Once you’ve turned 26, you will have to pursue different options. Honestly, some of these options may be better financial choices even prior to your 26th birthday. If you aren’t pursuing a career that offers employer sponsored health insurance there are several options to choose from.
Medicaid
The first option is Medicaid. If you are still finding your way in the world or if you are a college student, Medicaid may be a great option for you. Eligibility for Medicaid is dependent on the federal poverty guide, household size, and state. Medicaid can help to provide free or low cost healthcare options to those in need. Also, you can apply at any time. Unlike other options, there are no windows to take into consideration. You can contact your state’s Medicaid office or check your eligibility with healthcare.gov. This may also be a good option for you if you are pregnant and fall below a certain income level. Additionally, the CHIP program exists to help provide medical and dental coverage to children up to 19. You can find out more info about Medicaid & CHIP by calling 1-800-318-2596 or 1-855-889-4325 for TTY users. You can also login to healthcare.gov. For some, Medicaid really is the only option to consider due to finances.
ACA & Marketplace Plans
Marketplace insurance is another great option. This is part of the affordable care act (ACA). Again, you are going to want to logon to healthcare.gov to explore your options. And there will be many! Should you need any help, we encourage you to work with a licensed broker.
You can enroll during the Open Enrollment Period or during your Special Enrollment Period. The open enrollment period is every year at the same time Nov. 1-Dec. 15 or longer dependent upon your state. If you are on your parents’ plan and they receive their insurance through the marketplace, you will want to enroll during this time.
If your plan is a part of your parents’ employer sponsored health insurance, you will be eligible for a special enrollment period. Usually this will be the 60 days before you turn 26 through the 60 days after. However, it may be different if you are approved for an extension.
Additionally, you may be eligible for a tax credit which can save you thousands of dollars in monthly premiums. However, if you end up making more than estimated you may have to pay that tax credit back.
Short Term Medical Plans
You can also look into a short term medical plan. Today’s short term plans have evolved from years prior. Short term medical plans offer almost all the same essential benefits as ACA plans. You can obtain low deductible plans with coverage for preventive care, doctor’s visits, copays, prescription coverage and more. In many states, coverage can be purchased for up to 36 months. Generally speaking, the cost is much lower than marketplace plans (if you don’t qualify for a subsidy)and have nationwide PPO networks. While STM plans do not cover pre-existing conditions in the first year, multi year STM plans will provide coverage after that: something to consider when comparing your options. A young healthy person can access a plan as low as $100 per month, but there are definitely drawbacks. They are not available everywhere and they are not ideal for everyone.
Don’t Forget About Dental!
You can get dental through the marketplace (ACA Plans) but it may actually be less expensive to opt for private dental insurance. There are a variety of plans available and most plans range from $15-$50 per month. You can choose from a DHMO, a PPO, or an Indemnity plan.
If you have any questions, please feel free to contact us at iHealthBrokers at 888-918-0518 or schedule a call today!
Jesse Smedley is the Principal Broker for iHealthBrokers and the founder, president, and CEO of Smedley Insurance Group, Inc. and iHealthBrokers.com. Since the inception of SIG in 2007, Jesse has been dedicated to helping people save money on their health insurance by providing them with resources to educate themselves on all their health insurance options, both under age 65 and Medicare beneficiaries. He is featured in many publications as well as writes regularly for expert columns regarding health insurance and Medicare.
