The New Health Dialogue

A Blog from New America's Health Policy Program

COVERAGE: Everything You Need to Know About Dependents

Published:  August 20, 2010
pencils

Re-posted with clarification about employer-sponsored coverage.

Yes, it is that time of the year, Back To School. Along with the endless flyers announcing sales on packets of pens and pencils is a great deal of confusion around provisions in the health reform law that allow parents to keep their adult children on their health insurance plan, or dependent coverage as it is better known in the policy world.

Here is what I hope is a simple way to think about this for all of the parents and dependents out there, along with some unanswered questions that still need to be sorted out:

*Some insurers will not start coverage until after Sept. 23, 2010, creating potential time period where your child is either not covered or is paying for double coverage at school since most school years start BEFORE Sept. 23. (List here.)

** Note that there is an exception for non-grandfathered plans until 2014: young adults under 26 with employer sponsored insurance or with an offer of such coverage whose parents have a non-grandfathered plan that offers dependent coverage could enroll on their parents' plans; for the time being, most plans will keep their grandfathered status. (Click here for the regulations, page 17.)

Here are some typical scenarios I have come across:

Scenario 1:

My child is not my biological child (stepchild, adopted, foster dependent) -- can I still get them added?

This is not as clear cut -- most insurance companies are extending the definition of dependent to stepchildren and lawfully adopted children, but this hasn’t been specifically defined in the regulation and to be on the safe side, you should check with your insurance company. I would advise you to do this now, since the closer we get to September 23, the more congested their phone lines will be.

Scenario 2:

My child is out of state and has his own independent income but does not have health insurance. Can I still add him?

Technically in most cases, yes, you can add him BUT if your insurer does not have a network of providers that is accessible in your son’s area, then he might not be able to get much care with that coverage. Again, something to call your insurer about NOW.

Scenario 3:

My child has a chronic disease that I bet will exclude them from coverage.

YES and NO -- Thanks to the new legislation, starting in 2014, insurance companies will no longer be able to deny coverage based on a pre-existing condition. However, the health reform legislation does not provide specific information about how pre-existing conditions will be treated by insurers when a young adult rejoins a parent’s plan as a dependent prior to 2014.

Before health reform passed, when individuals joined an employer-sponsored insurance plan and had been uninsured for 63 days or more, they could be subject to a temporary pre-existing condition exclusion. In the non-group market (the individual market) the rules for uninsured individuals joining policies vary a great deal. It is unclear if these rules will apply to young adults rejoining a parent’s plan or if new regulations will be issued.

Here is a basic checklist for you to go through so you have all of the information at hand:

For more information, check out my interview this week on WTOP.

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