Young Adults: You’ve just graduated and you’re navigating the world on your own (more or less). Have you thought about health insurance?
Parent’s Health Plans
Your first option may be to stay on your parents’ health insurance plan. Under the affordable care act, employers have to offer health insurance to dependents up until age 26. Usually, you’ll have until December of the year that you turn 26. However, rules may vary slightly. Sometimes the cutoff can be your birth month. Other employers are more generous and may offer insurance benefits past the age of 26. Your parent can check with their HR department for exact terms.
Marketplace
Another option is, of course, marketplace insurance plans. You can enroll during open enrollment or during a special enrollment period if you qualify. If your state uses healthcare.gov, open enrollment is Nov. 1-Jan 15. Dates may vary slightly if your state uses their individual marketplace. If you’re unsure, logon to healthcare.gov and you will be redirected to your state’s individual marketplace if applicable.
Losing your health insurance or experiencing a change of life like moving or a change in household size, will qualify for a special enrollment period.
If you’re a young adult in the beginning stages of your career, you’ll likely qualify for a premium tax credit based on your income. This can save you thousands of dollars per year on monthly premiums.
You can select a plan based on your specific needs and budget. You’ll need to take into consideration monthly premiums, deductibles, copays & coinsurance, network and benefits offered. Remember, many benefits are offered with a $0 copay even before you’ve met your deductible.
There are even more variables to consider. PPOs vs EPOs vs HMOs, HDHPs or higher premiums and HSAs.
You can also work with a broker. A broker works for you, not the insurance carrier. Many brokers do not charge any type of fee for their services and your premium will not be any more expensive.
Short Term Medical Plans
Another option that’s great for young adults are short term medical plans. These are private insurance, so you may be subject to medical underwriting. Pre-existing conditions may not be covered in the first year or perhaps not at all.
However, these plans can be extremely cost friendly! A young, healthy person can pay less than $100 per month for a short term medical plan. They offer nationwide PPO coverage and are entirely customizable to meet your needs. For young, healthy adults, these can be great to cover your needs and protect you should you have major medical bills.
PPO coverage also gives you access in and out of network and you won’t need referrals. The increased flexibility is a major bonus.
Short term medical plans are not for everyone and they are not available in all states.
Group Insurance
If you work full time for an employer that has at least 50 full time employees, they are required to offer health insurance. You’ll still want to do some research and determine whether an HMO or PPO is better for your needs. If your employer offers HSAs which are health savings accounts, you may also want to consider that as an option.
Whatever option you choose, please do not go without some type of health insurance. Even if it is something as simple as a catastrophic coverage plan, you want to have protection in case of a major medical emergency.
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.
