California Insurance Rules for Young Adults

Young adults often are not able to obtain health insurance through their jobs because they hold entry-level or part-time positions that do not have benefits. New laws, effective September 23, 2010, allow young adults in California to enroll on their parents' employer-sponsored health insurance plans until their 26th birthday.

Time Frame

• Young adults cannot begin coverage until their parents' plan year is set to begin, unless the insurer offers a voluntary early enrollment period. Some insurers did this to allow early enrollment for recent college graduates who would otherwise have been dropped for the summer. If the employer did not offer early enrollment, a young adult might have to wait until as late as September 2011 to enroll if the previous plan year began before the new rules took effect. The insurer only has to give a 30-day window prior to the plan year for enrollment.

Restrictions

• Individuals with coverage through their own work cannot obtain coverage through a parent's employer. The special enrollment for young adults under 26 years old is only for those who cannot otherwise obtain health insurance through work. In addition, insurance companies have the right to reject applicants or exclude specific benefits for people with preexisting conditions until 2014. Lastly, you cannot enroll in a parent's health insurance policy if the employer offers individual coverage only, rather than family coverage.

Considerations

• If you are married or have children, be aware that they cannot obtain coverage through your parents; the special provision for coverage under the age of 26 only applies to you. However, your spouse could look into getting on his parents' plan, and your children might be covered by the state if you have low income.

Cost

• The cost of health insurance for young adults in California varies widely depending on the type of plan and the employer. If you get health insurance through your own job, it might be a perk or something you have to pay for each month. If you enroll on your parents' plan, they might have to pay more to their employer each month. However, if it is a family plan and you already have siblings enrolled, the rate might not change at all. Discuss with your parents whether their rate will increase, and if they will pay for it or if they want you to pay them monthly.