One of the many tasks young adults will need to learn is to navigate the world of health insurance.
Health insurance is a vital tool in the United States, but many kids grow up without knowing the different guidelines and options offered for different plans.
Here’s what you need to know about young adult insurance options.
Recent laws allow you to remain on your parent or guardian’s health insurance plan until you are 26 years old. This is helpful for you as you’re starting out on your own and may not be offered health insurance through an employer.
You’re allowed to stay on your parent's plan during these years, even if you don’t live with them, don’t rely on them financially, are attending school, are married, are a parent yourself or are enrolled in an employer's health care plan to use as your primary insurance plan.
The provider will likely notify you around your 26th birthday that your coverage will end around that date, depending on the insurer. At that point, you’ll likely qualify for a special enrollment period to get covered by your own insurance before the typical enrollment period.
If you get married, you will likely be able to get on your spouse’s insurance plan. Most insurers offer family plans that allow you, your spouse and any children you may have to be insured under one plan.
Having one plan can be advantageous for couples. Depending on the insurer, it could cost less than you each having your own plan. It’s also possible that your spouse’s plan offers more coverage than your parent’s or an employer-offered program.
Just because you are married, doesn’t mean you have to go onto one insurance plan, so look at your options to find the plan or plans that work for you.
There are no laws stating that your employer has to offer you health insurance, but it’s a good way for them to attract new hires, and large employers can be penalized under the Affordable Care Act if they don’t offer insurance to their employees.
Employers will typically choose to offer insurance through one insurance company, which may provide you with a few different plan options. The perk of this type of insurance is that your employer pays part of the cost.
If you want or need to purchase an insurance plan individually, the ACA Marketplace is a way to compare and buy a plan.
Under the Affordable Care Act, you can shop through participating providers and be eligible for significant discounts if you are under certain income levels.
Going through the marketplace can be a good option for self-employed individuals or independent contractors.
Medicaid is government-funded free or low-cost insurance that you may be eligible for based on your income and family size.
Each state sets its guidelines for Medicaid usage, so it’s essential to research what your state offers.
Things to Consider
When looking at all your insurance options, you’ll need to know about the specific types of insurers and what to consider with each.
There are different types of provider networks that have their own rules and regulations. A provider network is a group of healthcare providers that have agreed to accept specific insurance policies.
Health Maintenance Organization (HMO)
In an HMO, you must see providers within the network to have coverage, with out-of-network providers only allowed for emergencies.
When you’re in an HMO, you will need to have a trusted primary care physician (PCP), as they will be the one referring you to specialists and approving procedures and medications.
Due to the tight-knit nature of the network, you will likely have low premiums and a low or no-cost deductible.
Preferred Provider Organization (PPO)
In a PPO, you can out-of-network providers as you choose, though you may pay a little more to see them.
Due to its flexibility, PPOs typically have deductibles and higher premiums than an HMO. You are less likely to need a referral for specialist services when you have a PPO.
Exclusive Provider Organization (EPO)
EPOs allow you to go to any provider within your network, regardless of whether they are a specialist. This can be a great time saver for diagnosis and treatment.
Due to its in-network flexibility, you are likely to have no out-of-network benefits unless for some emergencies.
You’re unlikely to have a PCP under an EPO, so that you may need preapproval for certain services.
Point of Sevice (POS)
A POS plan has elements from both an HMO and PPO plan. In this plan, you will have more flexibility to see out-of-network providers than an HMO but will have a referral more often than a PPO.
In a POS, specialized services will need preapproval, but most of that can be done through your PCP.
Navigating the World of Insurance
Figuring out health insurance for the first time can seem daunting, but it's good to know that there are options to fit almost anyone’s needs.
Do your research or talk to a trusted professional to find the plan that’s most beneficial to you.