Children can remain on Parents’ Health Insurance Policy until age 26

The Affordable Care Act (ACA, Obama Care) allows children to stay on their parent’s health insurance plan until their 26th birthday.  The ACA changed the definition of a dependent, and now children can enroll on their parents’ policy even if the children:

  • Are not financially dependent on their parents for support,
  • Are not claimed as dependents on the parents’ tax return,
  • Are not residents of the parents’ household,
  • Are not enrolled as students; or
  • The children are married and have their own dependents; however children-in-law (spouses of children) and grandchildren are not eligible. “Children” includes natural children, legally adopted children, stepchildren and children who are dependent on the parent during the waiting period before adoption.

This law went into effect in September 2010 and remains the law for California small businesses that offer group medical, dental and vision coverage to their employees.

Allowing dependent children to stay on their parents’ medical insurance plan until age 26 eliminated significant problems for many Americans. For example, a child may have decided to go directly into the work world and get a job that didn’t offer medical insurance. That child would have to qualify for an individual policy that often had worse benefits than group medical insurance, was more expensive, and had fewer in-network doctors and hospitals.

The individual market for medical insurance before the Affordable Care Act had many problems.  For example, applicants had to answer medical questions and the insurance companies could decline to offer them coverage if they had a pre-existing medical condition.  This left many young people unable to obtain medical insurance.

Another problem arose for young people who went to college but perhaps were not enrolled as full-time students. In that situation, children over the age of 18 were no longer eligible to be dependents on their parents’ employer-sponsored health plan.  Again, this created a group of people unable to obtain group medical insurance.

College students also faced uncertainty regarding coverage during the summer when they were not enrolled in school.  Additionally, many college plans had very limited benefits which left students with huge financial liability when they were seriously ill or injured.

The Affordable Care Act did away with those problems plus others.  Now, children under age 26, regardless of where they live in the U.S.; whether they are financially dependent on a parent; or whether they live with the parent, can enroll as a dependent on their parents’ group medical insurance plan.

Give us a call at BenefitsCafe.com (800)746-0045 and we can assist you with your group insurance plan.