Young adults rely on their parent’s health insurance plans for medical coverage. But how long can you actually remain insured under a parent’s policy? There are options to extend coverage until age 26 or even beyond in some cases. Understanding the rules around dependent coverage can ensure you don’t experience an unexpected gap in health benefits.
Coverage for Children under Age 26
The Affordable Care Act (ACA) expanded the age that young adults can be covered under a parent’s health plan. Prior to the ACA, most health plans cut off eligibility at age 19 or upon college graduation. Now, the health care law requires plans that offer dependent coverage to include children up to age 26, regardless of financial dependency, marital status, college enrollment, or access to other insurance.
To qualify for this extended coverage, the young adult must be under 26 years old. They can be:
- Married or unmarried
- Financially independent or dependent
- Enrolled in school or not in school
The only major requirement is that the child cannot be eligible for other employer-based coverage, such as through their own job.
This regulation applies to all health plans except those considered “grandfathered” under the ACA. It covers young adults under private plans obtained through an employer, the Healthcare Marketplace, or directly from an insurance company. So most young adults now have access to parental coverage until they turn 26.
Options After Age 26
Once you hit age 26, you can no longer remain on a parent’s health insurance policy. At that point, you need to consider several options to avoid being uninsured:
- Enroll in your employer’s plan
If you have a full-time job that offers health insurance, you can sign up through your workplace. Employer plans may cover some or all of the premium costs.
- Sign up for individual health insurance
You can buy a private individual or family health plan directly through a health insurance company or the federal or state Marketplace exchanges. Shop plans during open enrollment or a special enrollment period.
- Look into COBRA
This federal law allows you to temporarily extend an employer’s health plan after leaving a job. You pay the full premiums. COBRA can bridge short gaps in coverage.
- Join a spouse’s plan
If you get married, you may be able to enroll in your spouse’s employer-sponsored health insurance as a dependent. Each situation differs, so verify eligibility rules.
- Consider public health programs
Medicaid, CHIP, and other public options like Basic Health Plans may be available depending on your income level and state.
Note – Shopping with health insurance agents or brokers can also help you compare plans and pricing. Act fast if you will lose dependent coverage soon to prevent any lapse in benefits.
Extending Coverage Beyond 26
In limited cases, it may be possible to stay on a parent’s plan past age 26:
- If you are disabled
Some health plans continue covering permanently disabled adult children beyond the age 26 cutoff. Talk to the health insurance company to confirm qualifications.
- Through state laws
A few states like New Jersey and Pennsylvania have laws requiring coverage up to age 30 or 31 under certain conditions. Refer to your state’s regulations.
- With student health plans
Many colleges and universities offer student health plans up to later ages like 30. Check with your school if you are enrolled in graduate studies.
But these exceptions are rare. Only the disabled provision is very common nationally.
For most young adults, turning 26 is the cutoff point for parental plan eligibility. Make sure you understand exactly when your coverage will terminate so you have time to secure alternative insurance and avoid gaps.
Planning a Smooth Transition
As you approach age 26, follow this checklist to smoothly transition off a parent’s health insurance:
- Know your end date
Confirm when you will lose eligibility. Mark it on your calendar.
- Research options
Start comparing other insurance plans 1-2 months prior to your 26th birthday. Outline costs, benefits, providers, prescription drug coverage, and other key factors.
- Enroll on time
Submit your application with enough time to activate new benefits by your 26th birthday. Avoid gaps between policies.
- Set payment
With individual plans, you must take over premium payments yourself. With employer plans, payroll deduction starts.
- Transfer records
Request copies of medical records from your pediatrician or family doctor to share with your new providers. And, if needed, you should have prescriptions transferred to a different pharmacy.
- Schedule exams
Make appointments with any new doctors or specialists to establish care under your new insurance policy.
With some advance planning, you can secure alternative coverage and achieve a seamless transition once you lose eligibility for your parent’s health insurance after turning 26. Consult an insurance agent or financial advisor if you need guidance assessing your options.