2011 Brings About Provisions of the Health Care Reform Law

Young Adults Get Covered By Parents’ Policies


The year 2011 has just rolled in, and with it provisions of the Affordable Health Care Act are beginning to take effect.  Namely, the new year spells the beginning of a provision in the bill that allows adult children to be included in their parents’ health insurance plans up to the age of 26.  Before this, many health insurance policies dropped children from their parents’ plans once they turned 19, sometimes allowing them to stay on during their college years.
This is considered a major part of the legislation because it is considered an important way to cut down on the number of uninsured in the country by closing the insurance gap that exists among many young people.  Because of this, many were in favor of this provision as it was debated in Congress.  Many others simply saw this as an extension of childhood for people in their 20s.
So why is this provision so crucial in achieving the overall goals that President Obama and Democrats set for a quality health care reform bill?  The answer lies in the problem.  According to a survey conducted by the National Institutes of Health, 30 percent of all adults between the ages of 20 and 29 have no health insurance.  The reason for this is because many of the jobs held by young people are temporary and/or lower paying jobs that do not include benefits like health insurance.  Thus, they are not provided insurance by their employer, and they cannot afford insurance on their own with the kind of money they make.  This has become a major contributor to the 32 million people without health insurance in America.
The question of course now becomes why this matters so much, and the answer is twofold.  First, let us consider the consequences of this insurance gap on families across the United States.  In particular, we can look at those families who have a person within this age range who has a medical condition.  Diabetes is just one example of a disease that many young people have that is also quite costly. In fact, thousands of dollars is spent on insulin annually by such families.  Without insurance covering the cost, it may mean that they have to pay out of pocket for these expenses.  Examples like these are what led to the great number of bankruptcies related to health care costs for American families in the past.  With this new provision, such young people can now be covered by their parents’ plan, though premiums for these policies may rise as companies are allowed to factor in these high-risk patients.  It may be cheaper for young adults to join their parents’ plans.  In the event that it is not, they still have the option of buying a cheap and affordable policy on their own.
Second, let us now consider the cost that is incurred on people with health insurance because of those who are not covered.  There is this idea that young people between 18 and 29 are healthy individuals who need health care coverage least of all. Generally this is true, but I would caution you to reconsider any thoughts that young people do not need health insurance.  Let us imagine that a young and healthy adult gets into their car and while on the road crashes into a tree or a guardrail and is in need of great medical attention.  That individual is rushed to the emergency room of a local hospital and their health insurance status goes unquestioned, as the hospital cannot refuse medical treatment by law.  This young adult is treated and is inevitably released from the hospital, though they did not have insurance to pay for that treatment.  Inevitably, this hospital bill goes unpaid.  Now who do you think bears the burden of that cost?
Well, at first the hospital must bear that cost because they provided that treatment.  However, they cannot pay for everyone without medical coverage.  So they pass it off to the consumer through price inflation making the average visit more costly than it otherwise would be.  But, typically, it is your insurance company paying the hospital bill.  And, it is you that pays the insurer.  Therefore, for those with health care coverage, know that it’s all on you.  And this not only applies to this one case, but to every hospital visit made by young people for medical emergencies who do not have health insurance.  This provision, by closing this insurance gap, will actually work to reduce the cost of health insurance premiums.
This section of the health care bill will also be helpful as the new health care insurance mandate is established.  Eventually, everyone will be expected to get basic health insurance.  This is the only way to effect true reform by covering everyone and lowering the costs.  In some cases, young adults have no access to health insurance.  In other cases, they refuse to buy it because they feel that they are healthy enough to live without it, and thus get out of paying the price of coverage.  For those who have chosen to live without it, that is no longer an option.  And as they consider how they will attain basic coverage, going on their parents’ plan may be the cheap and easy way to satisfy this new requirement.
For those who are young adults between 19 and 26 this provision of the health care bill is for you as it works to get you covered under your parents’ plan so that you do not have to struggle with the burden of these high costs as you enter the workforce.
For those that believe that health care should be a right, not a privilege, this provision of the health care bill is for you because it works to insure those 32 million Americans not currently covered by providing them with the care they need and deserve.
And for those of you who seek lower premiums for your own health care policies, this provision of the health care bill is for you because it works to get these young adults and their families to pay for their health care coverage so that you don’t have to.
This particular portion of the health care bill was hotly debated and was disliked by many.  But make no mistake, this was necessary for fixing the problems that currently exist in our health care system.  Without it, true reform may have been an unachievable goal.
Photo Credit: Tennessee State Employees Association