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A Longer Wait to Join Parent's Health Insurance

May 25, 2010

As final preparations are being made for the health reform to take effect in September, parents looking to add their children under age 26 may need to make preparations of their own.

The following question was recently asked of the New York Times:

Currently we have Cigna Insurance through my husband’s policy (the policy period runs July 1-June 30), but we are required to sign up yearly between May 1 and May 28. Our son, a full-time college student, turns 23 on May 30th and will be dropped from this policy as of June 1. My company says that we cannot add our son back to the policy until July 1, 2011…. I am seeking answers for this apparent hole in the policy and would greatly appreciate your response to help me clear up what is/is not required for this new law. — C. Williamson

The Times response explains if an employer decides against early implementation of the health care bill, they don’t have to begin extending coverage until their new plan year begins. However, waiting until the next plan year may not be enough. It has been speculated employers may begin requiring proof an adult child does not have access to coverage through an employer, adding contribution rate tiers or, in other words, determining rates on the number of dependents, and making employees who add their dependents to the plan responsible for the additional costs.

Young adults looking for coverage during this gap may want to consider a short-term medical plan. This type of health insurance can be less expensive than a permanent plan and provides coverage should an emergency situation arise. Designed for those between permanent insurance plans, short-term – also called catastrophic – health insurance may be the perfect fit for students graduating out of a parent’s or school’s health insurance.

Visit the GradGuard website to save time and money with free quote comparisons.

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