Thanks to the Affordable Care Act, many millennials were able to stay on a parent’s health plan until age 26 but more and more are “aging out.” Unfortunately, it’s hard to think of a more stressful time to do so. The marketplace has rarely been so muddled.
So it’s no surprise that young adults are having trouble picking their plans. A recent study of educated adults ages 19 through 30 found that nearly half couldn’t define basic insurance terms like “deductible” and “coinsurance.” (To be fair, plenty of older adults don’t understand those terms either.)
Unclear jargon and plain old information overload made it difficult for the young adults in the study to navigate healthcare.gov and buy health insurance. Most knew what they wanted in a plan (like coverage for preventative care and dental benefits) but couldn’t sort out which plans offered what.
When millennials add kids of their own to the mix, things get even more confusing. Not helping: Insurance costs are increasing. Analysts expect premiums for the most popular plans to increase an average of 34 percent in 2018.
So while we can’t ease the sticker shock, we can help clear up some confusion around this headache-inducing adulting transition. Here are a few things to know about getting you, and your family, covered.
Come to terms
Before you start shopping, brush up on insurance terminology. Preventative care refers to routine physical exams and many screenings; some plans cover 100 percent of preventative services, and well-child exams are often fully covered. Premium is the monthly fee you’ll pay for your plan. Deductible is the out-of-pocket sum you’ll need to fork over before your plan’s benefits kick in; high-deductible plans offer a lower monthly premium but usually require thousands in out-of-pocket costs before paying out. And coinsurance represents your share of the cost for a service.
When and where
The exchange (as in, buying a health insurance plan “on the exchange”) refers to your state’s online insurance marketplace, where you can compare and purchase health plans. You can also buy a plan directly from an insurance company. Although the open enrollment period when anyone can apply for coverage runs Nov. 1 through Dec. 15, Washington’s Apple Health (Medicaid) plan enrolls year-round.
If you experience a qualifying life event — including having a baby, getting married or getting divorced — you qualify to sign up outside the open enrollment period if you take action within a few months of said life event. If you’re about to turn 26 and lose coverage on your parents’ health plan, buy your plan by the month before your birthday so you don’t have a gap in insurance coverage.
An Apple a day
While tax credits can help make insurance coverage more affordable, your family might qualify for free plans, too. Washington’s Apple Health (Medicaid) plan offers free or low-cost health coverage for kids and families or provide secondary coverage to pick up health expenses not covered on other plans.
A family of five making just over $60K annually qualifies for free Apple Health coverage for all their kids; families earning a bit more qualify for Apple Health coverage with a maximum monthly cost of $40. Apple Health also covers prenatal care for pregnant women, along with care for 60 days after a birth.
These days, it’s common for young families to carry a mish-mash of insurance. One parent may have employer-sponsored coverage while the other carries a high-deductible plan and the kids have insurance through a parent’s employer with secondary coverage through Washington Apple Health.
Note: When someone has more than one healthcare plan, the plans are referred to as primary and secondary. Generally, an employer-sponsored plan provides primary coverage, making any other plan you carry your secondary plan. You can’t claim coverage for the same benefits on both plans, so either one covers a service that the other doesn’t (i.e. one plan might cover chiropractic care, but not the other), or the secondary plan pays for coinsurance costs left over after the first plan’s benefits max out.
Above all, don’t go it alone
Sorting this stuff out is complex, and it’s wise to get help. While you can get some (free) guidance from Navigators on health exchange websites, there’s another option option — independent health insurance agents. They’re paid by insurance companies, which means you don’t pay for their advice. Most work with a wide range of insurance companies, so they can compare plans to help get you the coverage you want — and a little peace of mind, too.