Posted on Mon, Jun 14, 2010
A new medical insurance reform provision states that medical insurance will be extended to adult children up to age 26 under their parents' policies effective January 1, 2011. However, a survey conducted by Hewitt Associates shows that approximately 950,000 employees will be offered the option to cover their dependents much earlier than what the provision requires.
Hewitt had surveyed more than 500 large American employers, which represents almost 7 million employees with coverage. The results showed that about 1 in 5, or roughly 19 percent, of large employers plan on extending medical insurance to dependents up to age 26 earlier than what is required. Of all of those companies, 10% will offer medical insurance coverage earlier for all eligible dependents, and 9% will extend coverage for students that are graduating that are already insured under the medical insurance plan.
Approximately seventy-seven percent of employers are intending on waiting on extending coverage to eligible dependents until next year, when they will be required to extend coverage, which is the plan year that begins on January 1, 2011. 4% of large employers still don't know if they will offer coverage earlier or not.
The reason why a large percentage of large employers are extending coverage earlier is to boost employee morale and to earn goodwill from employees. This is especially helpful since a good percentage of adult children cannot find employment or lost their jobs during the recession. However, most companies are waiting to offer extended coverage because of the money it would cost and the paperwork that is involved.
About 57% of employers have already budgeted the cost of extending coverage to eligible dependents up to age 26. Of those, 18% are expecting to see less than a 1% increase in yearly medical care costs between the years of 2011 and 2014. 26% of companies estimate a 1%-2% increase, and 11% estimate a 2%-5% increase.
With this new provision, Hewitt predicted that an employer may cover 5%-10% additional adult children than they do today.
Posted on Wed, May 20, 2009
As graduates across the country are preparing for new adventures and responsibilities, the importance of affordable health insurance coverage is becoming a reality. In a new poll released by UnitedHealth Group, Inc, over 2/3 of young adults in the US know they need affordable health insurance, but over half of them say they don’t have the information they need to choose the right type of coverage to meet their needs.
1,000 young adults were polled and 67% of them haven’t made any plans for health insurance. While these 18 – 21 year olds know they need medical insurance coverage, they aren’t clear about the coverage they have through their parents and don’t even know when that coverage will end.
Young adults are in the largest and fastest growing group of the 46 million uninsured people in the US. This alarmingly large group of Americans, along with the 25 million underinsured, is facing incredible risk by not having appropriate coverage in the case of a medical need.
When you need affordable medical insurance and you cannot get coverage through your employer, it can be confusing how to even begin the process of finding health coverage on your own.
Determine your insurance needs: Before you can find the most affordable health insurance plan, you need to understand how insurance policies work. When it comes to cost, there are two things to understand -the deductible and the co-pay. Nearly all insurance plans have both a deductible and co-pay you are responsible to pay.
The deductible is the amount of medical expenses you have to pay out of pocket before your insurance coverage kicks in. The co-pay is the portion of each individual charge you must pay, in addition to the insurance company’s portion. For example, if you have a $500 deductible, you are responsible to pay the first $500 of medical expenses per year, before your insurance company pays anything. With the co-pay, you must pay a percentage of each charge, often at the time of your service.
To help keep your health insurance affordable, you have options how you pay these expenses. If you are in reasonably good health, choose a lower deductible and higher co-payment. If however, you go to the doctor fairly often, you pay be better off with lower co-payments, but a higher deductible. Once your annual deductible is reached, you will have less expense through out the year. For the most affordable health insurance premium, choose both higher deductibles and higher co-payments. This will at least spread your costs out over a length of time.
You can compare rates and plans for medical insurance online. This way you can look at several different types of policies from different companies and take your time deciding the best option for your medical insurance needs.
It is very important for young adults to have a good understanding of the type of insurance they need. With the large number of health insurance companies, as well as the variety in policies and coverage, the only way to find the most affordable health care coverage is to do some research and compare your options. Most importantly, however, is to avoid going with non health insurance at all so you don’t wind up with huge expenses you cannot afford to pay.