Steve Rosen

Kids & Money | Weigh all the options for adult children’s health insurance

Updated: 2011-11-15T20:16:04Z

By STEVE ROSEN

The Kansas City Star

When it comes to health insurance for your adult children, I feel it’s always best to explore all your options.

Case in point: Your 22-year-old has just landed a restaurant job that offers medical benefits. Sounds perfectly fine to you because you’ll be offloading one more drain on your wallet.

But there’s a larger issue that complicates things. The health care premiums are really going to lighten your son’s paycheck considerably, and you’re now feeling the need to help out financially. In fact, you’re thinking the easiest thing would be to keep your twentysomething on your health plan at work.

That question comes up frequently this time of the year from parents during enrollment season for employer-provided health care.

What’s the answer?

It depends on your company’s policy, said Carrie McLean, a health insurance expert at eHealthInsurance, an online consumer insurance service. That’s the short answer, but like most everything else attached to health care, it’s easy for confusion to reign.

The Affordable Care Act requires that most — but not all — health insurance plans provide coverage to an adult child up to age 26 on their parents’ policy. The law applies to married and unmarried children but does not extend to their spouses or children.

More than 1 million young adults have remained insured as a result of this change, according to government estimates.

But here’s where the law gets complicated. If an adult child has access to another employer-provided health plan, your insurer generally can refuse coverage.

The key word is “generally” because, McLean said, some plans allow adult children who have other coverage options to stay on their parents’ plan.

Her advice to parents: Given some of the interpretations of the fine print, check with your human resources department to see what your plan allows for covering adult children up to age 26. You might be surprised to learn that your plan has broader coverage for adult children so they can remain on your policy.

Keep in mind that the rules will change again in 2014, when all health plans will be required to offer coverage to an employee’s children until they turn 26, even if they have another offer of coverage through an employer.

When deciding any health insurance plan, compare the cost of the coverage with the benefits you’re entitled to receive. It might turn out, for example, that your young restaurant worker’s medical policy offers broader and better coverage than your own.

Individual policies, rather than an employer-provided plan, might also be a better option for your workers looking for less comprehensive coverage at affordable prices. Get price quotes and policy breakdowns from websites such as www.ehealthinsurance.com.

If money is tight for your child or there are significant health issues, you could help pay some of the out-of-pocket expenses. However, tread carefully down this path so you’re not endangering your own financial situation.

Whatever you decide, get your twentysomething engaged in health care decisions and the jargon that goes with it. The major elements of health care reform will soon be landing squarely in their laps.

To reach Steve Rosen, call 816-234-4879 or send email to srosen@kcstar.com.

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