Millennials And The Affordable Care Act

Millennials And The Affordable Care Act

According to the White House:  As a result of the Affordable Care Act, Millennials have much better health insurance options during their young adult years than past generations. Since September 2010, young adults have generally been eligible to remain on a parent’s health insurance policy until they turn 26. Previously, young adults frequently lost access to a parent’s plan when they turned 19 or graduated from college. In addition, as of the beginning of 2014, many young adults newly qualify for tax credits to purchase health insurance coverage through the Health Insurance Marketplaces or Medicaid in States that have accepted Federal funding to expand their Medicaid programs.

From the time the Affordable Care Act’s dependent coverage provision took effect in 2010 through the first quarter of 2014, the uninsurance rate among individuals ages 19 to 25 fell by 13.2 percentage points, a 40 percent decline.30 In the first quarter of 2014, the share of young adults without health insurance coverage was 20.9 percent, the lowest young adult uninsured rate recorded since the National Health Interview Survey began using its current design in 1997.31 Other analyses using private survey data show that overall insurance coverage continued to expand during the second quarter of 2014, so these estimated gains are likely to grow in the coming months. Moreover, analysts predict that coverage will continue to expand in the years ahead.

According to the Wall Street Journal: Since 2010, the ACA has required insurers to allow dependents to stay on their parents' plan until age 26, even if they have a job with benefits. In 2014, young adults will also be able to buy insurance on the new state exchanges if they can't get affordable coverage (costing 9.5% of income or less) through an employer. (This assumes, of course, that the young adult complies with the ACA; another option is to skip insurance and pay the penalty.

Some young adults might get a better deal buying health insurance through the exchanges that open Oct. 1, especially if they qualify for a government subsidy.

But only those who can't buy affordable health insurance through a job are eligible for subsidies. And while 20-somethings generally pay less for health coverage because of their age, they also will get smaller tax credits than older workers: A 25-year-old would have to make $33,000 or less to get a subsidy, while a 50-year-old earning $45,000 could receive $1,115 back, according to the Kaiser Family Foundation's eligibility calculator.

Since subsidies are determined by household income, the cost of an exchange plan depends not only on the young adult's salary, but also on whether the parents claim that child as a dependent. Families might consider scratching 20-somethings with modest earnings off their tax forms and sending them to collect their subsidy on the exchange, says Carrie McLean, senior director of customer care for eHealth Inc., EHTH -5.76 % the online insurance broker.

On the other hand, if parents also are buying on the exchange, including a nonworking or low-earning young adult could qualify the whole family for subsidies because household income is then stretched across more people. A 55-year-old couple earning a combined $78,000 wouldn't be eligible for subsidies, but if they included their jobless 25-year-old, they could receive more than $9,000 in tax credits.

Many parents feel that the initial ACA law of 2010 requiring parents to carry health coverage on their adult child age 19-26 was the flipside of the later passed ACA law requiring all young adults to carry health insurance or pay a penalty.  Giving young adults the choice they would most likely choose to stay on Dad and Mom's plan than pay a monthly health insurance premium, (unless of course, Mom and Dad make them pay their share of the premium).  Given the choices our young adult children have today in the way of health care, they should count their blessings. Generation X  had no choice when they graduated highschool but to work hard to get a good paying job that provided health insurance and/or stay healthy!  





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Phone: 614-270-3954
Dated: November 10th 2015
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