More than 19 million previously uninsured young adults are affected by the new health reform legislation. There’s a lot that this group, the one most likely to not have any form of health insurance, needs to learn.
Known as millennials, this generation came of age during a strong recession and reduced employment opportunities. Many can’t find jobs, can’t get insurance if they do have jobs and some are continuing to live at home with their parents. Under the new law young adults can stay on or go back to their parents’ health insurance plan until age 26 as long as they are “dependents.” They don’t have to live in the same home. Married children are covered, but not their children or spouses.
An estimated two million young adults will gain access to health insurance through their parents’ plans and some nine million will obtain care through the Medicaid expansion. Those with pre-existing conditions that previously prevented coverage will no longer face those barriers. Some eight million will get tax credits that enable them to purchase health insurance, for the first time, at lower costs.
Those numbers, however, could be much higher. A 2009 Commonwealth Fund survey found that 45 percent of those between the ages of 19 and 29 were uninsured, a figure significantly higher than the 30 percent rate reported for 2008 by the Kaiser Family Foundation. The discrepancy may be due to the continued poor economy.
Young Invincibles, a nonpartisan advocacy group, says one of the key benefits for young adults will be reform’s impact on employment. Young adults are less likely than older adults to be provided insurance benefits at work. The new bill will enable them to purchase insurance that stays with them when they change jobs or create their own businesses or free agent careers.
"For all Americans, but particularly young Americans, this is a historic moment that guarantees affordable, stable health care for all," said Aaron Smith, Young Invincibles co-founder. "This bill will provide our generation with the opportunity to pursue our dreams without fear of a lack of health insurance."
While young people will gain a lot from reform, there will also be costs. For the first time, everyone will have to get insurance. Those who could afford insurance but didn’t buy it because they thought they were too “young and healthy” to need it, will have to purchase a plan or face being fined.
According to Young Invincibles, the timeline for young Americans is as follows:
90 Days After Passage (June 2010)
• Access to insurance through a temporary “high-risk pool” for Americans who were denied coverage due to a pre-existing condition. This will benefit the 15 percent of young Americans who suffer from chronic conditions.
Six Months After Passage (September 2010)
• Allow young Americans to remain on their parents’ health insurance until age 26.
• Prohibit health plans from dropping individuals’ coverage when they get sick.
• Ban lifetime limits on covered benefits.
• Prohibit restrictive annual limits on benefits (all annual limits banned by 2014).
• Require pre-deductible preventive care services with no cost-sharing under all new plans (applies to all existing plans by 2018).
January 1, 2011
• Require all plans to spend 80 percent (for small/individual plans) or 85 percent (for large group plans) of premiums on medical services. Those who fail to do so must submit rebates to consumers.
Benefits After Full Implementation (January 1, 2014)
• Expand Medicaid to cover every American earning less than 133 percent of the Federal Poverty Level (FPL), providing coverage to nine million currently uninsured young adults.
• Provide tax credits for purchasing health insurance to individuals who lack employer-provided insurance and earn less than 400 percent of the FPL.
• Ban denial of coverage based on pre-existing conditions.
• Limit insurance companies to charging older adults no more than three times the insurance premiums of younger adults.
• Establish state insurance exchanges to facilitate market competition and enforce minimum benefit standards.
• Offer young adults under age 30 the option of purchasing a low-cost Catastrophic-Plan.
Resources for more information:
Dependent Coverage Expansion: Frequently Asked Questions http://www.younginvincibles.org/cover.html
Kaiser Family Foundation—Dependent coverage laws state by state:
http://www.statehealthfacts.org/comparetable.jsp?ind=601&cat=7
State Health Access Reform Evaluation (SHARE) - Information on how dependent coverage expansion will impact individual states
http://www.rwjf.org/files/research/54548.pdf
About the author: Pat Elliott is a journalist and blogger who has written about health issues and health insurance for more than 20 years. She is also a cancer survivor who coaches people on how to manage their transition and take control of their new future.