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Complicated young adults: How do you get them covered?

By Allison Bell

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Officials at the agency that runs the Patient Protection and Affordable Care Act (PPACA) exchange program for the U.S. Department of Health and Human Services (HHS) have come out with a guide for helping young adults get health coverage.

The officials at the agency, the Center for Consumer Information and Insurance Oversight (CCIIO), developed the guide with nonprofit exchange helpers in mind, but it could be useful to agents and brokers who are young workers, clients’ children, or other young consumers.

PPACA turned the old dependent coverage rules upside down, by reclassifying many young people who were not previously thought of as dependents as dependents for insurance purposes, and by requiring plans that offer dependent coverage to let insureds treat those young adults as dependents up to age 26.

Health insurers were already trying to find ways to increase sales to “young invincibles” before PPACA along, and the provision appears to have some Republican support. One Republican alternative to PPACA, the Patient CARE Act bill, includes a provision that would let young adults stay on their parents’ coverage up to age 26.

For a look at some of CCIIO’s advice about untangling the results of the rules, read on.

Kendall

1. Kendall

Suppose Kendall, who is 22 and single, lives in a different state from her parents and is not a dependent on their return. She is uninsured. What can she do?

She could enroll in her father’s employer plan, officials say, but she might not want to do that, because the out-of-state plan may have no providers, or a skimpy provider network, in her area.

Kendall might get a better deal by applying for qualified health plan (QHP) coverage through a PPACA exchange and getting premium tax credit subsidies, officials say.

See also: Exchanges fear churn and burn

Ella

2. Kendall and baby Ella

Suppose Kendall is single and has an 11-month-old baby. What happens then?

Officials note that Kendall’s father’s employer plan may have to offer Kendall access to health benefits, if it provides dependent benefits.

But “dependent coverage under an employer-sponsored plan is not required to include dependents of dependents,” officials warn.

That means baby Ella may have to get her minimum essential coverage elsewhere. The cheapest way may be to get an exchange QHP, Medicaid or Children’s Health Insurance Plan (CHIP) coverage, officials say.

See also: Uninsured rate hits 5-year low

Devin

3. Devin

Devin is the 19-year-old son of an engineer who has quit his job and wants to sign up for exchange QHP coverage for the whole family. The father will earn $86,000 in 2015. His wife does not work.

Devin is a full-time student at an out-of-state college and his parents will pay $10,000 in tuition for him in 2015. His parents claim him as a tax dependent.

Devin could get COBRA benefits continuation coverage through his father’s plan. Being eligible for COBRA would not keep him from getting exchange coverage, but having COBRA coverage would keep him from getting exchange coverage, officials say.

One challenge is that Devin might be happy just to get a bare-bones catastrophic plan, but family members who apply through one application can’t enroll in different plans if one of the plans is a catastrophic plan.

See also: Feds temporarily expand COBRA escape option