How Long Are You Covered on Your Parents' Insurance?

The Department of Health and Human Services reported in 2010 that about three in 10 adults under age 26 have no health insurance due to affordability and availability issues. The passage of the Affordable Care Act will change those numbers, allowing young adults to remain on their parents' health insurance policies until age 26.

Federal Law

• In 2010, the federal government reformed the common policies of health insurance that stopped health insurance coverage for child dependents of policy-holders once they either reached age 19 or graduated college. Now, all health insurers must allow adult dependents to remain on their parents' health insurance policies until age 26 regardless of whether or not the dependent attends school or lives with his parents. Even married, financially independent children can opt for dependency on a parent's health insurance plan, rather than purchase a private health policy.

Omission

• Though the Affordable Care Act of 2010 expands the age for dependency eligibility, there is one temporary exception for adult children. According to Healthcare.gov, the law provides an exception for adult children who currently have access to an employer's group health insurance plan through work. The exemption is only available to insurance policies that were underwritten prior to the passage of the Affordable Care Act in March 2010, but will expire Jan. 1, 2014, when all insurance policies must accept adult dependents regardless of their other health coverage options.

Coverage

• The government prohibits insurers from discriminating against dependent ages on a health insurance policy. Insurers may not isolate coverage terms for older dependents or divide older and minor dependents into separate coverage groups but instead must provide identical coverage, premiums and enrollment policies for all dependents enrolled in a health insurance plan. However, while insurers cannot raise rates solely for older dependents, they can raise the overall premiums associated with the health plan. According to the U.S. Department of Health and Human Services, the overall cost of health insurance premiums for plans that offer dependent coverage are expected to rise about 0.7 percent due to the passage of the 2010 health care law.

COBRA

• If a dependent is enrolled in his parents' health insurance policy at the time he turns 26 years old, he may qualify for COBRA benefits if the insurance policy is a part of an employer's group plan. COBRA is an extension of insurance benefits for qualifying policy-holders and enrollees. Though the dependent will assume primary policy-holder status and likely pay a higher monthly premium, he can keep his health insurance for up to 36 months.