Q. Will my father’s premiums go up if I get coverage through his plan instead of my university’s plan?
A. Young adults under 26 can get coverage through a parent’s plan even if their school (or their own employer) offers health insurance. This was one of the first provisions of the ACA to be implemented, and HHS reported in 2016 that 2.3 million young adults gained coverage under their parents’ health plans between 2010 and 2013, when the ACA’s exchanges opened for business. Young adults are significantly more likely to be covered under a family member’s plan now than they were prior to the ACA.
For small-group plans, insurers can charge a premium for each additional child on the plan (up to a maximum of three under the age of 21, but children age 21 and older can be charged an additional premium regardless of how many children are on the family’s plan). But large group plans often charge a flat rate for a “family plan.” In that case, adding another dependent does not necessarily increase premiums as long as there are already other children on the plan.
So if your father has other children on his plan, the price he pays may be the same regardless of whether he has one dependent or several. According to the Commonwealth Fund, the under-26 rule led to an increase of just 0.9% in group plan premiums in 2011, the first year after young adults were allowed to remain on (or rejoin) their parents’ plans.
But some insurers that offer large group coverage charge premiums per member for family coverage rather than a flat rate. Some also are moving away from a single deductible for the whole family and opting for a separate deductible for each family member (although there will generally still be a family deductible that’s typically double the single deductible, which is useful in case multiple family members incur significant medical claims).
Before you sign up, your father should ask his employer whether his premiums will change if he adds you to his plan. If so, you and he can do the math to see whether it makes more sense for you to get your own plan (either through the university or in the individual market) or obtain coverage under your father’s plan. You’ll want to be sure to account for the provider network too; if your father’s plan is a local HMO and you attend school in another location, you might find that you only have coverage for emergencies while you’re away at school, and that you have to return to your home area in order to receive non-emergency care.
And be aware that large group health plans are not required to cover maternity care (for labor and delivery charges) for dependents, which might be a factor in your decision.
Keep in mind that open enrollment periods and special enrollment periods apply, regardless of where you get your coverage. Your university will let you know when you can enroll in the coverage it offers. Individual market coverage has an open enrollment period each fall, from November 1 to January 15 (with some state-by-state variation). Your father’s employer likely has an open enrollment period sometime in the fall, but it may be at another time of the year.
When the ACA first made it possible for young adults to remain on their parents’ health plans until age 2016, insurers and employers had to offer a special enrollment period, during which young adults could rejoin their parents’ health plans. But that was in 2010/2011. Currently, the option to rejoin your father’s plan would only be available during his plan’s annual enrollment period, or during a special enrollment period triggered by a qualifying event.