Finding Health Insurance When You Age Off Your Parents' Plan

What happens when you turn 26

Your parents' health insurance coverage ends on the last day of the month you turn 26. This is a federal rule that applies to all health plans, whether through an employer, the marketplace, or a private insurer. You will need your own coverage starting the first day of the following month, or you will have no insurance at all.

The good news: you have options, and you have time to find one before your coverage ends. Most people can find a plan that works for their budget and health needs. The tricky part is knowing which route fits your situation — whether you're working, in school, living in a state that expanded Medicaid, or some combination of these.

Key Takeaways

• Your coverage under your parents' plan ends the last day of the month you turn 26, so you need to act before that date arrives.
• Turning 26 is a may have access to life event that lets you enroll in a marketplace plan outside the normal open enrollment period.
• If your employer offers health insurance, you can enroll in that plan when you turn 26 without waiting for the annual enrollment window.
• Medicaid covers people with low income in most states, and some states cover more people than others based on their own rules.
• If you cannot afford any plan, you can still see doctors and get prescriptions — community health centers charge based on what you can pay.

Employer coverage if you have a job

If your employer offers health insurance, this is usually the cheapest option because your employer pays part of the premium. You can enroll when you turn 26 without waiting for the company's annual open enrollment period — turning 26 counts as a life event that opens enrollment for you.

Contact your HR or benefits department and tell them you are turning 26 and need to enroll. They will send you the plan options, the costs, and the enrollment deadline. Most employers give you 30 to 60 days to choose. Read the plan documents carefully: look at the monthly premium you pay, the deductible (the amount you pay before insurance kicks in), and which doctors and hospitals are in the plan's network.

If your employer's plans are very expensive or do not cover the doctors you see, you can decline employer coverage and buy a marketplace plan instead. But once you turn down employer coverage, you usually cannot go back to it until the next annual enrollment period, so think this through before you decline.

Marketplace plans if you don't have employer coverage

The Health Insurance Marketplace (also called the ACA marketplace) is where you buy individual health plans directly. You can enroll outside the normal open enrollment period because turning 26 is a may have access to life event. Go to HealthCare.gov if you live in most of the United States, or your state's own marketplace website if your state runs its own (California, New York, and a few others do).

You will answer questions about your income, household size, and where you live. Based on your income, you may may have access to for a tax credit that lowers your monthly premium. The lower your income, the bigger the credit. You only find out what you may have access to for by entering your information — there is no way to know without going through the process.

Plans are sorted by metal level: Bronze (lowest premium, highest out-of-pocket costs), Silver, Gold, and Platinum (highest premium, lowest out-of-pocket costs). If your income is low enough, you also may have access to for cost-sharing reductions, which lower your deductible and copays on Silver plans specifically. You have until the last day of the month you turn 26 to enroll, and coverage starts the first day of the next month.

Medicaid if your income is low

Medicaid is free or very low-cost health insurance for people with low income. Whether you may have access to depends on your income and which state you live in. Some states cover people earning up to 138% of the federal poverty line; others have lower income limits. A few states have not expanded Medicaid at all, so the rules are much stricter there.

You apply for Medicaid through your state's Medicaid office or through HealthCare.gov. When you apply, the system will tell you right away whether you may have access to. If you do, coverage can start as early as the first day of the month you apply. Unlike marketplace plans, Medicaid has no enrollment deadline — you can apply any time.

If you live in a state that has not expanded Medicaid and your income is too low to may have access to for marketplace tax credits, you are in a coverage gap. In that situation, community health centers (see the section below) are your best option for affordable care.

Community health centers if you have no insurance

If you cannot find or afford any plan, community health centers provide medical care, dental care, mental health services, and prescriptions on a sliding fee scale. This means they charge based on what you actually earn, not a fixed price. Some people pay nothing; others pay a small amount per visit.

You do not need insurance to go to a community health center. Search for one near you at FindAHealthCenter.HRSA.gov. Call and ask about their sliding scale fees and what documents you need to bring (usually proof of income, like a recent pay stub or tax return). Many centers also help people enroll in Medicaid or marketplace plans while you are there.

What to do right now

Write down the exact date you turn 26 and the last day of that month. That is your deadline. Then take one of these steps depending on your situation: if you have a job with health insurance, contact your HR department this week. If you do not have employer coverage, go to HealthCare.gov or your state marketplace and start an application — you do not have to finish it today, but starting it shows you what you actually may have access to for.

If your income is very low, apply for Medicaid at the same time. You can be enrolled in both the marketplace and Medicaid at once — the system will sort out which one actually covers you. If you are unsure whether you have a job that offers insurance, ask your manager or check your employee handbook. If you still have questions after looking at your options, call 211 and ask for help understanding your choices.

What happens if you miss the deadline

If you do not enroll before your parents' coverage ends, you will have a gap in insurance. You can still enroll in a marketplace plan, but you will have to wait until the next open enrollment period (usually November through January) unless you have another may have access to life event. During the gap, you are responsible for the full cost of any medical care.

If you get sick or injured during a gap, you can still go to a community health center or an emergency room. The emergency room will treat you regardless of insurance, but you will receive a bill afterward. Community health centers will work with you on payment. The gap also means you cannot get prescription refills through insurance, though some pharmacies offer discount programs for people without insurance.

Frequently Asked Questions

Can I stay on my parents' plan past 26?

No. Federal law requires all health plans to end coverage the last day of the month you turn 26. There are no exceptions. Your parents cannot pay extra to keep you on, and the insurance company cannot make an exception.

What if I'm in school or unemployed?

Your student or employment status does not change your deadline. You still need coverage starting the first day of the month after you turn 26. If you are unemployed or a full-time student with low income, you likely may have access to for Medicaid or marketplace tax credits, so your actual cost may be very low.

Do I have to pick a plan right when I turn 26?

You have until the last day of the month you turn 26 to enroll. You do not have to decide immediately, but do not wait until the last week — if something goes wrong with your application, you will not have time to fix it.

What if my parents' insurance company says I can stay on longer?

They cannot legally do this. The federal rule is absolute. If an insurance company tells you this, ask to speak to a supervisor or contact your state's insurance commissioner's office. But the answer will be the same: coverage ends at 26.

Can I get health insurance if I have a pre-existing condition?

Yes. Health plans cannot deny you coverage or charge you more because of a pre-existing condition. This applies to all marketplace plans, employer plans, and Medicaid. You are protected by federal law.