The experience that states have had with pre-Affordable Care Act (ACA) insurance expansion to young adults shows the process is non-problematic, but there are undetermined implications for risk pooling, cost distribution, and prolonging the parental dependence of young adults.
The ACA requires that young adults up to age 26 be allowed to enroll as dependents on their parents’ health plans. But prior to the ACA, 31 states had already enacted laws increasing the maximum age of eligibility for dependent coverage. This article reviews the experience of those states through March 2011 and includes detailed case studies of four states that handle premiums in two different ways: New Jersey and Colorado allow insurers to charge separate premiums to parents for insuring young adults, while Maryland and Minnesota, similar to the ACA, require coverage to be included in family premiums.
The authors point out it is not known whether, by removing too many healthy young adults from the risk pool, expanded parent coverage will negatively impact ACA health exchanges that are soon to be formed. The authors also note equity concerns regarding young adults who do not have access to parental coverage, and social concerns as dependency on parents is prolonged.