Countdown to Coverage: Young Adults and the Marketplace

Working for a Better Texas

By Megan Randall

Young adults from ages 19 to 29 are one key group that stands to benefit from the launch of the new Health Insurance Marketplace on October 1.

Young adults, like other age groups in the U.S., need a health insurance solution.  In a recent Commonwealth Fund survey, more than one third of young adults reported being uninsured currently or at some point during the last year.  Having adequate health care coverage helps to protect young adults from unexpectedly high medical costs (including from accidents or injury that might occur), and can make a big difference in helping young adult students complete college and achieve academic success.  In one recent Public Agenda survey, 69 percent of students who did not graduate from college said that providing health insurance to all students, including to those only taking classes part-time, would be of significant help to students in obtaining a college degree.

Contrary to popular belief, young adults want health insurance.  In a recent Kaiser poll, seven in 10 young adults said that having health insurance is “very important” to them, with a similar share reporting that they need health care coverage and that it is worth the money.

The main barrier to getting young adults covered is affordability.  The Affordable Care Act (ACA) has already helped 7.8 million young adults achieve coverage by allowing them to stay on their parents’ policy as a dependent up to age 26 (see the Commonwealth Fund survey cited above).  Starting October 1, many young adults will be able to apply for new coverage options available to them in the Health Insurance Marketplace, along with premium subsidies and cost-sharing reductions to help make coverage more affordable.  Below, find some of the key provisions that could benefit young adults when Marketplace coverage goes into effect on January 1, 2014:

  1. Premium Subsidies and Cost-sharing Reductions – In Texas, single young adults without affordable job-based coverage and with income between roughly $11,500 and $46,000 annually will likely be eligible for discounts on their premiums (in the form of tax credits) when shopping in the individual Health Insurance Marketplace. Moreover, single young adults with income between roughly $11,500 and $28,700 annually may be eligible for cost-sharing reductions that will lower the amount of out-of-pocket costs they will be responsible for that year.
  2. Preventive Care with No Cost-sharing – Starting in 2014, insurers must cover preventive services with no copayments, coinsurance, or deductible.  This includes preventive check-ups and many screening tests as well as contraceptive methods and counseling for all women.
  3. Catastrophic Plans – For those young adults under age 30 who would like a more limited-benefit policy to protect them from very high, “worst-case scenario” medical costs, catastrophic plans will be available in the Marketplace.  Catastrophic plans will have high deductibles and a lower monthly premium.  Please note that neither premium subsidies nor cost-sharing reductions will be available for the purchase of catastrophic plans.  In fact, the premium help available to young adults with low incomes may make comprehensive coverage premiums as low as or even lower than a catastrophic plan, with better benefits and lower out-of-pocket spending. Catastrophic plans must also offer preventive benefits with no cost-sharing as well as three primary care visits per year before meeting the deductible.

Have more questions about young adults in the Marketplace?  Check out these resources:

Young Adults – HealthCare.gov

Healthy Young America – Young Invincibles

And don’t forget to check out www.HealthCare.gov to learn more about the Health Insurance Marketplace and October open enrollment!

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