When healthcare reform passed, one of the headliners of the groundbreaking legislation was the measure which allowed parents to add adult children onto their health insurance up until the age of 26. With a historic economic downturn dragging and many young adults and recent college graduates unable to find any work, let alone jobs with health insurance benefits, thousands of concerned parents breathed a sigh of relief.
Unfortunately, reality wasn’t nearly so easy. Many employers dragged their feet in allowing employees to add adult children to their group health insurance, and hiked health insurance premiums in response. Parents also found that adding adult children to their health insurance wasn’t a very practical solution in many cases, for example when a child lived on the other side of the country.
And it’s been particularly unuseful to one group: retirees. Healthcare reform may require employers and individual health insurance policies to extend benefits to adult chidlren, but the requirement does not apply to Medicare which does not offer dependent coverage. And even if your former employer is one of the shrinking pool who offer health insurance benefits to retirees, the requirement to allow adult children onto health insurance does not apply to retiree-only health insurance plans.
All is not lost, though! If you’re retired and trying to find health insurance for your adult child, here are 4 options that you should consider:
Employee-Retiree Mixed Health Insurance Plans. Confirm with your former employer that your health insurance plan is for retirees only. Only retiree-only health insurance plans are exempt from healthcare reform requirements like the one regarding adult children. As long as your retiree health insurance plan includes at least some current employees, you should still be able to add your child to it.
COBRA. If your child has just lost its status as a dependent because of your retirement, he or she should still be eligible for up to three years of health insurance coverage through COBRA. The catch, of course, as with all COBRA health insurance coverage, is that you will be on the hook for the full health insurance premimum plus a 2-3% administrative fee, so it can be an expensive option for health insurance.
Individual Health Insurance Policies. If your child is young and healthy, buying an individual health insurance policy for him or her should be pretty easy and inexpensive. A word to the wise, though, make sure to consider all the potential costs that you and/or your child may have to pay if he or she gets sick, not just the health insurance premiums. Deductibles, co-pays, co-insurance, and exclusions can add up fast if your child does have a medical emergency, so make sure you’re aware of them before an emergency hits.
Pre-Existing Condition Insurance Plans (PCIPs). If your child has a pre-existing condition and cannot find health insurance on his or her own, they are probably eligible for health insurance under another feature of healthcare reform, the pre-existing condition insurance plans or PCIPs. PCIP health insurance premiums are limited to standard rates in the area and out-of-pocket costs are capped. Unfortunately, your child will need to have been without health insurance for six months in order to be eligible for a PCIP. For more information, visit HealthCare.gov.
Do you have a retiree-only health insurance plan? Tell us about it!
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