Turning 26: Your Guide to Health Insurance

Many young people choose to stay on their parent's health insurance for as long as possible and for good reason. The landmark health law, also known as Obamacare, allows young adults to stay on their parents' health plan until they turn 26, no matter what happens.

Married? Is studying? Don't you live with your parents? Doesn't it depend on financial support from your parents? Are you eligible to enroll in an employer's health insurance plan? Even if you identify with any or all of these circumstances, you can still have insurance through your parents' coverage. For those whose 26th birthday is approaching, understanding the world of health insurance can be a new challenge. However, signing up for coverage can be easier than it sounds. Here's what to know to get ready to start shopping for a new health insurance plan.

Do I Lose Health Insurance when I Turn 26?

The exact time a person loses coverage from their parents depends on that health insurance. It is important to review the parent's plan before it is time to blow out the birthday candles.

• If parents have a Marketplace plan, the deadline is until December 31 of the year of their 26th birthday to enroll in their own health insurance. If you want the new coverage to take effect on January 1 of the following year, you must complete the enrollment before the open enrollment expiration date, which is December 15 in most states.
• If either parent is covered by an employer-sponsored plan: The parent's employer-sponsored health plan coverage ends on the last day of the month of birth. For example, if the birthday is March 15th, medical coverage ends on March 30th (the last day of that month), fifteen days after the 26th birthday.

Health insurance plans can have different rules, so it's a  good idea to check when coverage ends. If the parent has insurance through an employer-supplied plan, the human resources department can help obtain the information they need.

How Long Do I Have to Enroll in Health Coverage After My 26th Birthday?

When a person turns 26, they have 120 days to enroll in their own health coverage. This includes 60 days before your 26th birthday and 60 days after. Do you want your plan to start on the first day of the following month? A good rule of thumb is to enroll in the new plan no later than the 15th of the previous month when you want your new coverage to begin. For example, if you want your new health insurance to begin on October 1, you will need to enroll in a plan no later than September 15. And remember, you will have 120 days to do so during the special enrollment period. If you don't apply for health insurance during the special enrollment period, you may have to wait until the next open enrollment in the fall. And in the meantime, not having health coverage puts your finances and health at risk, especially if you have to face an unexpected medical emergency while in the donut hole.

What Are My Different Health Insurance Options?

1. Enroll in the employer group plan. If a person qualifies for health coverage under the employer's group health insurance policy, they can enroll before they turn 26. But employer-sponsored coverage takes effect when the parent's health insurance plan ends. If the parent's employer group plan was the one providing coverage, there are 60 days to enroll in the new plan after losing that coverage.
2. Buy coverage offered by an insurance company. Private plans and medical plans outside the Health  Insurance Marketplace are available directly through different carriers.
3. Buying coverage through a broker or agent. Brokers and agents can help 26-year-olds learn about enrollment options and compare different plans. Be aware that brokers sell plans that are offered by different insurance companies. Agents often sell plans on behalf of a single company. The use of the services of an agent or broker must be free. If a broker or agent is trying to charge you, you should look elsewhere. Consumers should not have to pay fees to use their services.

What Should I Consider Before Signing Up?

Start by assessing your own health care needs and financial situation. Different plans offer different levels of coverage. Although all the Marketplace health plans offer a wide range of preventive services at no cost to you. Consider the cost of monthly premiums, deductibles, and prescription drugs when looking at the different plans. That way, you can better evaluate the type of coverage that is right for you. Some plans have higher monthly premiums but offer lower copays, deductibles, and out-of-pocket maximums. Plans with lower monthly premiums have higher rates associated with using the plan when you need it.

How Do I Enroll in Health Coverage?

If you want to apply for health insurance through the Marketplace, the first step is to get a quote. This process takes less than 5 minutes and is what determines if you are eligible for the savings. After that, the qualifying life event that makes you eligible to enroll during a special enrollment period is chosen. Once you choose the best option for you, you can complete the application for health insurance. After that, you will need to make the initial premium payment and you are all set. If you are enrolling during a Special Enrollment Period, you will need to provide documentation showing that coverage is ending. Please note that if you enroll during Open Enrollment, you will not need to mention the qualifying life event or submit documentation. Individuals who enroll in private insurance through their employer should contact the human resources department to begin the enrollment process.

What if I Decide to Go without Health Insurance?

The cost of emergency medical care is usually more than the premiums, deductibles, and copays combined. Staying insured is one of the easiest ways to protect your finances and health.

Can I Continue My Parents' Health Insurance After Age 26 if I Am Disabled?

To remain on the parents' health insurance after turning 26,  an adult with a disability would have to live in a certain state that allows such warnings and have a qualifying disability. In case someone is in this situation, they can check with the medical plan to see if they qualify.