You'll need to do more than make a wish for good health when you
blow out the candles on your 26th birthday.
If you're among the millions of young adults who have stayed on
their parents' health insurance plans, you'll need to find new
Patient Protection and Affordable Care Act
lets a young person stay on a parent's health plan up to age 26.
Whether the coverage ends on your birthday or at the end of the
policy year depends on the plan.
"Most plans are at least extending it to the end of the month or
to the end of that policy year," says Steve Wojcik, vice president
of public policy for the National Business Group on Health.
As your 26
birthday approaches, your parent should contact their employer's
human resources department to find out when coverage will end.
"It's important to plan ahead instead of waiting until the last
minute," says Martin Rosen, co-founder of Health Advocate in
Plymouth Meeting, Pa., a service that helps individuals and
employers navigate the health care system.
options to explore when you're kicked off a parent's plan.
Enroll in your own employer's health plan
If you have a job that offers health insurance, let your
benefits administrator at work know you'd like to enroll in the
health plan. Normally you sign up for health insurance at work
during open enrollment, which typically takes place in the fall for
the following year. But under federal law you're eligible to sign
up outside of the open enrollment period if you've lost coverage on
your parent's plan.
Married? Get coverage through your spouse's health insurance
If your spouse or domestic partner has job-based health
insurance, see if you qualify for coverage on his or her plan. Most
employers that provide health insurance to employees extend health
benefits to spouses, and a growing number of employers extend
benefits to domestic partners. Don't procrastinate. Under federal
law, your spouse or partner has 30 days after you lose coverage to
ask the employer to add you to the health plan.
COBRA is short for the
Consolidated Ominius Budget Reconciliation Act
. The law gives families a safety net if they lose
employer-sponsored health insurance because of unemployment,
divorce, death of a spouse or loss of eligibility for coverage as a
dependent. Under COBRA, you can continue to receive health
insurance benefits under your parent's plan for up to 36 months.
This might be your best bet if you have a health condition that
would make qualifying for an individual insurance policy difficult.
There's one big catch, though -- you have to foot the premium, plus
up to a 2 percent administrative fee.
Your parent's health plan administrator should notify you about
your eligibility for COBRA continuation coverage, Wojcik says. You
will have 60 days to decide whether to elect coverage.
Know your COBRA rights
Comparison shop for an individual health insurance policy
You might find coverage that's more affordable than COBRA by
shopping for an individual health insurance plan. An independent
health insurance broker can help you sort through the options.
Think about what health care you're likely to need and compare
premiums. Generally the higher the deductible, the lower the
premium. Other out-of-pocket costs include copayments for doctor
visits and co-insurance -- the percentage of health care bills you
pay after the deductible is met. Consider how much health care
you're likely to need and plan accordingly.
"Do the math and do your homework and make some sort of
evaluation," Rosen says. "People tend to overinsure. Why would you
pay an extra $400 or $500 a month for a low-deductible plan if you
only go to the doctor two or three times a year?"
Dig into the details about what plans cover before you select
one. Here's how to buy the worst health insurance plan ever: 7
scenarios to avoid.
Starting in 2014, you'll have to have health insurance by law,
and you'll be able to shop for plans through a state insurance
marketplace called an exchange. Insurers won't be allowed to deny
you coverage or charge higher premiums because you have a health
But until then you might have trouble qualifying for an
individual health plan if you're already ill. Or an insurer might
sell you a policy but exclude coverage for the pre-existing
If you make little or no money, check whether you qualify for
Medicaid, the federal and state program for low-income individuals
If buying health insurance is simply out of the question, look
for ways to save on health care. Community clinics offer services
on a sliding scale, and most health care providers are willing to
negotiate costs for uninsured patients.
Also, comparison shop prescription drug prices. Retailers such
as Wal-Mart and Target offer one-month supplies of many generic
prescription drugs for $4. Read about how to get free prescription
"The Healthcare Survival Guide: Cost-Saving Options for the
Suddenly Unemployed and Anyone Else Who Wants to Save Money" by
Rosen and Dr. Abbie Leibowitz features other tips and is available
online for free.