When will children be able to stay on parents' health insurance and will dental be included?

April 20, 2010 3:44 PM

Two questions related to the provision of the US healthcare bill related to dependents getting to stay on parents' plans until age 27.

1) Is there an actual ETA on when the provision of the bill that allows dependents to stay on parents' health plans until they turn 27 will go into effect? They said within 6 months of signing, but I haven't heard anything about when they think it will actually take place (need to know whether to budget the exorbitant cost of my crappy grad student health plan renewal due in a couple months or look for a gap policy that covers a shorter time span).

2) Will dental be included in this? My parents' plan is all one company that provides the dental and medical, same insurance card, all that, but I have a feeling if the insurance companies can legally worm out of covering dependents for dental, they will.
I have Googled on many occasions, hoping some new info would come up, but there's just so much static out there when you try to search for terms related to the new health legislation, and I was hoping someone out there might have some better information.

posted by ishotjr to health & fitness (18 answers total)

Oh and nice double use of "related to," self. It's been a long day...
posted by ishotjr at 3:45 PM on April 20, 2010

First: It's until age 26, not 27, so it may not matter for you. Second, it doesn't take effect until September. Third, some of the largest insurance companies have announced that they will cover graduating students until September, with more companies likely to follow suit. Source.

I have no idea about dental coverage.
posted by jedicus at 3:50 PM on April 20, 2010

I am monitoring this closely as well. I have a few clouds of doubt in my head about how this will be handled and implemented. Here is what I am thinking.

1. Most employer plans allow dependents on based on the IRS's dependents rules because of the employer plans' pre-tax status. The rules put forth in the new healthcare legislation do not match up to these IRS rules and I am positive that is contributing to the employers' hestitation to immediately implement this option. They are probably worried that the pre-tax status of the plan is in jeopardy, which would affect everyone on the plan.

2. There is no way that employers will be willing to subsidize the cost of adding dependents past the traditional plan limit ages. This is similar to a number of states like Florida, where children can be kept on the parents' employer's plan until age 30--after the limiting age set forth by the plan, the premium is usually almost 100% cost, which is similar to COBRA. Be prepared to shell out a lot of money to remain on the plan.

3. Speaking of COBRA, I've not heard anything about whether aging off the plan due to the healthcare legislation's age limits will be a qualifying event under COBRA.

4. I know this is federal legislation, but usually anything that has to do with insurance has to be adopted by the state department of insurance, and that has yet to happen; in fact, there are several states preparing to sue the federal government.

So, I wouldn't bet on anything happening anytime soon in this arena.
posted by FergieBelle at 3:57 PM on April 20, 2010

I read that it's THROUGH age 26, so until the 27th birthday.
posted by ishotjr at 4:02 PM on April 20, 2010

hit enter too soon, ughh, is this incorrect? Some sources specifically say until age 27.
posted by ishotjr at 4:05 PM on April 20, 2010

According to the National Association of Health Underwriters:

"All group and individual plans, including self-insured plans and grandfathered plans, within siz months of enactment, will have to cover dependents up to age 26 under current law..."
posted by yoyoceramic at 4:13 PM on April 20, 2010

From the bill: "A group health plan and a health insurance issuer offering group or individual health insurance coverage that provides dependent coverage of children shall continue to make such coverage available for an adult child (who is not married) until the child turns 26 years of age." Source.

I'm afraid coverage ends on your 26th birthday. I can provide many more sources if you like, but the bill itself is pretty clear.
posted by jedicus at 4:14 PM on April 20, 2010

Here's a question: What about us in the donut hole, aka, those who fell off their parent's plan but aren't 26 yet? Will we be able to rejoin?
posted by speedgraphic at 4:36 PM on April 20, 2010

'through x' usually means 'up to and including x', so that would just be people clarifying that 'up to 26' does not mean it ends at your 26th birthday.
posted by jacalata at 4:55 PM on April 20, 2010

Many states have this already.

http://www.ncsl.org/default.aspx?tabid=14497

As I read the Illinois law (215 ILCS 5/356z.12 (e) Calculation of the cost of coverage provided to an unmarried dependent under this Section shall be identical.) , it says that costs for those dependents must be identical to any other dependent.
posted by gjc at 5:18 PM on April 20, 2010

I'm in Texas, one of the states that is planning to sue, so assume that my state has no similar existing provisions whatsoever.
posted by ishotjr at 5:25 PM on April 20, 2010

Nonetheless, the link says this:

Texas


V.T.C.A. Insurance Code § 846.260 and V.T.C.A. Insurance Code § 1201.059 make dependent status available for an unmarried child up to age 25 for insurance purposes.
posted by gjc at 6:47 PM on April 20, 2010

Right, I had insurance on my parents' plan until I turned 25, but now I'm hoping to get back on it until I age off again (when I turn 26). I doubt that Texas will be going out of their way to adopt any new especially consumer-friendly laws for insurance customers beyond whatever the federal regulation regarding premium prices end up being. Thanks for the answers! I'm not sure who to ask about the dental thing, that's my biggest concern since there is effectively no dental insurance available to me at this point (school doesn't offer it, private plans are ridiculously expensive or have huge restrictions that basically make it useless for at least a year).
posted by ishotjr at 7:24 PM on April 20, 2010

Just as a data point - I am in Texas and I have United Health Care (one of the companies in the source that jedicus linked to) through my employer. My children are 19 and 20, and they are enrolled in college fulltime, so they are on my policy.

This month, I received a notice from my employer that states they are performing an audit of all dependents declared on all policies. I am required to submit birth certificates to prove they are my children, and since they are in college I am also required to provide either a statement of verification from their college or a transcript of the current semester. Any dependent who does not provide this documentation by the deadline of April 30 will be dropped from the policy.

Prior to this, all I had to do was state that they are mine and that they are students; now I have to prove it or they will be dropped.

Now, maybe this tightening of the rules is coming from my employer and not from United Health Care, but this does not sound to me like they are planning to be nice guys and cover that gap.
posted by CathyG at 8:45 PM on April 20, 2010

RE: jedicus's comment quoting the PPACA. Married children were added to this change by Section 2301(b) of H.R. 4872 - the "Health Care and Education Reconciliation Act of 2010"

(b) CLARIFICATION REGARDING DEPENDENT COVERAGE.—Section
2714(a) of the Public Health Service Act, as added by section
1001(5) of the Patient Protection and Affordable Care Act, is
amended by striking ‘‘(who is not married)’’.

Note however that this coverage is still dependent on the child being a dependent.
posted by Snerd at 5:31 AM on April 21, 2010 [1 favorite]

I read that it's THROUGH age 26, so until the 27th birthday.

That is correct.

Here's a question: What about us in the donut hole, aka, those who fell off their parent's plan but aren't 26 yet? Will we be able to rejoin?

Yes. There is nothing in the law saying that those eligible have to already be on their parents' plans at the time of enactment, so everyone under age 27 is eligible.
posted by ekroh at 10:58 AM on April 21, 2010 [1 favorite]

I read that it's THROUGH age 26, so until the 27th birthday.

That is correct.

Wait, no, that's not correct. I was reading a different provision. Sorry. It's until 26th birthday.
posted by ekroh at 11:03 AM on April 21, 2010

The rules put forth in the new healthcare legislation do not match up to these IRS rules

The coverage is through the 26th birthday, but the reconciliation amended the bill (and amended the Internal Revenue Code) to allow the coverage for the adult dependent to be excluded from the employee's income through the end of the tax year during which the individual turned 26 (the language of that provision is confusing to some people because it refers to age 27, but it says:

(d) ADULT DEPENDENTS.—
(1) EXCLUSION OF AMOUNTS EXPENDED FOR
MEDICAL CARE.—The first sentence of section
105(b) of the Internal Revenue Code of 1986 (relating
to amounts expended for medical care) is amended—
(A) by striking ‘‘and his dependents’’ and
inserting ‘‘his dependents’’; and

(B) by inserting before the period the following:
‘‘, and any child (as defined in section
152(f)(1)) of the taxpayer who as of the end of
the taxable year has not attained age 27’’.

Tax laws usually refer to the taxpayer's status on December 31 of the tax year, so that's what this is getting at.

As to effective date, what people have said is correct - and for fully insured plans, insurers (which are regulated by the state) might decide to start the coverage before the effective date, which otherwise is the first day of the plan year following September 23, 2010 (January 1, 2011 for many plans). Self-insured plans are not subject to state regulation so there would be no unified movement to start the coverage earlier, though employers are allowed to of course.

The tax exclusion provision is effective for tax year 2010.

As to dental and vision, everything I've read is that, while the mandate under health care reform does not require the extension of dental and vision coverage, under the tax code “health care” plans extend beyond the “medical” component to include these additional plans. If plan sponsors continue dental and vision coverage, they would be available on a tax-favored basis on the same terms as the medical plan.
posted by Pax at 6:09 PM on April 24, 2010