Healthcare and health insurance is a complicated topic, and there are many differing opinions on how it should best be handled. In many countries, there is universal healthcare for everyone, but that is not the case in the United States. While there are government-run programs for the elderly (Medicare) and those with low-incomes (Medicaid), most people get health insurance for their family through private health insurance companies, usually through their employer.
This coverage often extends to the employee’s family, including spouse and children. Most insurance plans have a limit on how old the employee’s children can be to still receive coverage. When the Affordable Care Act (ACA) passed in 2010, this limit was standardized to be 25 years old.
How Long Can You Stay on Your Parents’ Health Insurance?
The Affordable Care Act standardized the age in which children could remain on the health insurance plan of their parents at 25. Before the ACA, it was common for insurance companies to drop children after they turned 19. This caused many young adults to be uninsured, which was one thing that the Affordable Care Act seeked to address. With the ACA, you’re covered until you are 26, regardless of if you:
- Are or are not enrolled in school
- Are no longer claimed as a dependent for tax purposes
- Are married
- Have or adopt a child
- Choose not to take employer-sponsored health insurance coverage
In most states, soon after you turn 26, you will no longer be eligible to receive health insurance from your parents’ health insurance plan. If your parents are on an ACA marketplace plan, you’ll usually have until the end of the calendar year where you turn 26. If your parents get their health insurance through an employer plan, you may lose coverage at the end of the month when you turn 26 or possibly on your birthday itself. Make sure you understand the exact date when your coverage ends so you can make plans.
Six states (Florida, Illinois, New Jersey,, Pennsylvania, South Dakota and Wisconsin) have passed additional legislation allowing young adults to stay on their parents’ insurance past the age of 26. If you live in one of those states, make sure that you check your state laws to understand how that might affect you.
What To Do BEFORE You Get Kicked Off Your Parents’ Insurance
If you are turning 26 or otherwise losing access to your parents’ health insurance, there are a few things that you might want to consider doing before your birthday. This is especially true if you’re migrating to a situation where you won’t have health insurance at all, or if the health insurance you’ll have will be not as good.
So before that happens, you should consider making sure that all of your routine healthcare needs are taken care of. If you have any expensive operations or procedures that you have been considering, you should try to schedule those before you turn 26. Make sure to give yourself a bit of leeway as well, since there may be post-operative care as well that you’ll want to make sure to have completed before the deadline.
Health Insurance Options
Your health insurance options after you lose access to your parents’ health insurance will depend on your specific situation.
- If you have a full-time job that includes health insurance as a benefit, then there isn’t much you’ll need to do. You can move to the insurance that comes with your job
- Still a full-time student? Your college or university may provide a health insurance option
- If you have no or limited income, you may qualify for Medicaid or other health insurance targeted towards those with lower incomes
- If none of those scenarios apply, you will probably want to look for health insurance in the Healthcare Marketplace (see below)
Shopping the Healthcare Marketplace
With the introduction of the Affordable Care Act (colloquially known as “Obamacare”), healthcare marketplaces were introduced starting in 2014. Most states have their own individual marketplace, but they typically are similar and conform to federal guidelines. In most cases, there is an open enrollment period that happens at the end of the calendar year, but if you have a qualifying event, you may be able to sign up for a health insurance plan even outside the open enrollment period.
In an ideal situation, you’ll be able to plan your transition over the course of several months. Since you know the date that you’ll lose access to your parents’ health insurance plan, you should be able to take the necessary steps to ensure that you still have access to adequate healthcare after that happens. As with many things, a bit of planning can help avoid possibly significant negative consequences.
The ACA offers several levels of plans: Catastrophic, Bronze, Silver, Gold and Platinum. Each plan has different levels of coverage, copays, deductibles and monthly premium cost. Depending on your income and financial situation, you may also qualify for tax credits that can help reduce the overall cost of the insurance plan. Compare the different options to decide what is right for you.
The Bottom Line
In most cases, young adults can stay on their parents’ health insurance until they turn 26. Before that happens, they can choose to remain on their parents’ health insurance, regardless of any other factors like income, student status, marriage or if they have a child. Make sure to make a plan for when you will lose access to your parents’ insurance, including possibly taking care of outstanding medical procedures beforehand. Then choose from the available insurance options to make the best plan for your situation going forward.