Extending Coverage by Keeping Youth on their Parents Health Care Plan

Young adults between the ages of 19 and 29 represent one of the largest and fastest-growing segments of the U.S. population without health care coverage.  In an effort to ensure that all Americans are insured a growing number of states have enacted legislation to allow children to stay on their parents' health insurance plans well into adulthood.

Youth at Risk of Being Uninsured: Young adults represented over 13 million of the approximately 45.7 million Americans under 65 years of age living without health insurance in 2007, according to the latest available census data.  That amounts to approximately 30 percent of 19 through 29 year olds being uninsured.  According to a report by the Commonwealth Fund, "[b]y far, the young adults most at risk of lacking [health care] coverage are those from low income households."  The report's data also found that Hispanic and black young adults were at greater risk of being uninsured than whites. Specifically, 36% of blacks and 53% of Hispanics between the ages of 19-29 lacked health care insurance, compared to 23% of whites. 

Most children receive health care insurance either through their parent’s or guardian’s policy or a public health plan.  This coverage generally expires when an individual graduates high school or college or at the age of 19.  Once dropped from their parent’s policy or from a public program it is often difficult for young adults' to secure their own health insurance, either because of ordinary transitions, their employment status, or for monetary reasons.  Purchasing private insurance is often not an option since the average monthly premium for young adults is an estimated $400 to $500 per month - too pricey for many young people, especially when an estimated 40% of uninsured young adults live in households with incomes below the federal poverty level.

States Take Action:  In response to the growing problems of uninsured young adults, states have passed laws that require health insurers to allow children to stay on their parents' health insurance plans for a longer period of time.  According to NCSL, 34 states now have laws that expand dependent health insurance coverage and State Net reports  that 17 states considered such legislation in 2009. Three states-- Idaho, Pennsylvania and Nebraska-- enacted such legislation.  A half dozen similar bills are still pending either for this year or rolling over into 2010.  New Hampshire, "which already allows young adults to stay on their parents' policy up to age 26," has sent a bill (SB 115) to Gov. John Lynch (D)  that would "allow low-income adults up to the same age buy into the state's Healthy Kids program for approximately $200 a month." 

Limits to Laws Requiring Coverage on Parents' Plans: The majority of states which have extended the age of which children can remain on their parents' plans place certain restrictions on the health care coverage, such as requiring the adult child to be unmarried, and in all but a few states "coverage can only be extended to adult children who have no kids of their own."  

According to Laura Tobler, a health care policy analyst with NCSL, states find these laws attractive because they increase access to health coverage at no real extra cost to the state.  However, she cautions that these bills are not a solution for the rising cost of health care, especially since no enacted measure to date requires employers to carry an employee's adult dependents on the company policy and that the laws generally apply only to employer-provided group plans.

State Net - More states helping young adults keep health coverage 
Commonwealth Fund - Rite of Passage?  Why Young Adults Become Uninsured and How New Policies Can Help, 2008 Update
Testimony--Young and Vulnerable: The Growing Problem of Uninsured Young Adults and How New Policies Can Help 
Rutgers University Center For State Health Policy - State Policies Expanding Dependent Coverage to Young Adults in Private Health Insurance Plans 
Kaiser Health News - Expanding Health Insurance Options For Young Adults