Affordable Health Insurance Options for Young Adults

Recent college graduates who are having a hard time finding permanent employment do have options when it comes to finding affordable health insurance.

Thanks to the Affordable Care Act, dependent children have the option to remain on their parents’ health-care plan until age 26. The reform also aims to make private, individual health insurance more affordable.

A study by eHealthInsurance.com found that 73% of employers are expecting an increase in dependent coverage in 2012 due to the law passed in 2010. Some states allow dependents to remain on these plans until age 30. Young adults do not have to be financially dependent on their parents or live with their parents to remain on their parent’s plans. They can even be married.

“Keep in mind that if your parents’ plan is geographically local to where they live, and you live five states away, remaining on their plan may not be the be the best option,” says Karen Pollitz of the Kaiser Initiative on Health reform and Private Insurance. “In that case, you may want to look at purchasing an individual health insurance policy.”

Those who don’t have the option to participate in a parent’s plan may want to look at an individual health insurance policy offered by a major insurance carrier.

“It’s a misconception that health insurance in the private market is unaffordable,” says Keith Mendonsa, a consumer specialist for eHealthInsurance.com, an online health insurance marketplace. “You can find something as low as $82 per month for a $5,000 deductible. Lower deductibles will cost more per month, but you’ll find that a lot of preventative- care procedures, such as an annual physical, are covered at no additional charge.”

Health coverage plans generally run on a month-to-month basis, with no cancellation fees and no contracts, so if individuals do find a job that offers full health benefits, they can cancel their individual policy with no added fees, according to Mendonsa.

Mendonsa urges those seeking individual health insurance plans to work with a licensed agent to help them find the best option for their needs.

“Each major insurance carrier has a different portfolio of plans,” he says, “so working with a professional is the best way to quickly and easily find what you’re looking for.”

Those shopping for an individual insurance policy may also find out what’s available in their area by visiting HealthCare.gov, which allows users to search for plans by type and zip code.

“If you have a pre-existing health condition, and therefore have trouble finding coverage through a major insurance provider, there are options available to you,” says Pollitz. “The Affordable Care Act established the Pre-Existing Condition Insurance Plan, or PCIP, to help those who can’t find private coverage.”

The rates through a PCIP are comparable to that of a medically-underwritten policy, and vary according to state of residence and the plan chosen. Medical and prescription deductibles will also vary. Twenty-seven states, including California, Illinois and New York, run their own programs, and eligibility rules vary across the states.

The Federal government, through the U.S. Department of Health and Human Services, runs the Pre-Existing Insurance Plan in 23 states and the District of Columbia. Applicants must have one of the following documents to qualify:

• a letter from a medical professional dated within the past twelve months verifying a person’s medical condition, disability, or illness;
• a denial letter from a licensed insurance company for individual coverage dated within the last 12 months;
• a letter from an insurance agent or broker that shows an individual is not eligible for individual insurance coverage because of a medical condition.

Applications can be submitted through PCIP.gov.