As you pass go, collect health insurance

With health-care reform laws taking effect, students should check how they’re affected.

Health care is a complicated, boring and expensive mess that most college students would like to ignore for as long as possible. In most cases this isn’t hard to do, since most insurance plans allow full-time students to latch onto their parents’ plan until their mid-twenties.

But once the diploma changes hands from dean to college graduate, health insurance can transform into a world of hurt overnight, as new grads are left grappling for benefit-providing jobs, footing the bill for their own plan or finding themselves completely uninsured.

Luckily, there’s some relief in sight for those who would prefer to fend off the brutal world of insurance costs and out-of-pocket medical expenses a little bit longer, courtesy of the federal government.

Six months after the health care reform bill was dragged uphill through both houses of Congress in March, another set of regulations will become law at the end of September.

While many of the changes amount to nothing more than minor alterations to an already complicated set of insurance regulations, one stands out: the extension of the maximum age that young people can stay on their parents’ insurance plan, from 23 to 26.

Temple alumnus Daniel Doherty, who majored in education and graduated this past May, couldn’t find a job in his field or one that gave him health benefits. If not for the age extension, he said, he would have had to go uninsured or move back in with his parents to cut costs.

“Most college students have a skewed idea on how much they’ll be spending when they get out. They think they’ll make $50,000, and that’s rarely the case,” Doherty said.

“It was a big deal, because you never know,” he added. “It’s an unbelievably huge help.”

Not all plans currently cover dependants until age 23, and they won’t be required to extend it to 26 until that company’s next fiscal year, which, for some, could be as far away as mid-2011.

Geralyn O’Kane, assistant director of the benefits administration, emphasizes that the law is not as clear-cut as it is commonly described and will actually affect students differently depending on their parents’ individual plan.

“What everybody needs to do is find out what age they can stay covered under their parents’ plan,” O’Kane said. “It’s not the same for everyone. People work all over the place.”

O’Kane also explained that Temple’s health insurance program is currently being reviewed. When it is announced, she said, it will include the option to keep dependent children on until age 26.

Despite the level of complication on the individual level, the law will ultimately lead to a massive expansion of insurance coverage for people in the 19-to-29 age bracket.

The Commonwealth Fund, a New York-based nonprofit, estimates that the age extension will result in 650,000 people getting insurance in 2011 alone. It projects another 550,000 will switch back over from a private plan.

Young people are statistically the most uninsured of all age groups. The Department of Health and Human Services, Labor and Treasury estimate that there are currently 6.6 million people without insurance nationwide, and in 2008 Pennsylvania’s Insurance Department set the number at 383,298 for the state.

There are a couple of explanations for this. Many fresh college graduates are unable to find a job that includes health benefits, while others haven’t shaken off the feeling of youthful invincibility and simply feel they don’t need it. Some still can’t afford a private plan with the meager salary many recent grads bring in.

For recent grad Elizabeth Hanson, a political science major who graduated last May, having the option to forestall insurance payments allowed her to follow a more fulfilling career instead of one that simply paid the bills.

“I was offered two jobs right out of school, one with full benefits that I knew wasn’t right for me, and another [without benefits] that I was passionate about,” said. “Knowing that I could stay on my parents’ insurance until I was 26 allowed me to get a job that I was passionate about. I can only imagine what a headache it would’ve been if this law hadn’t passed.”

Situations like these stem from shortfalls in the current, soon-to-be-replaced regulations and account for many of the swarms of uninsured young adults.

Anyone who isn’t a full-time college student typically doesn’t get the luxury of parental coverage until 23. Instead, many plans drop them at 19.

This also includes health care provided by publicly funded programs, such as Medicaid and Pennsylvania’s Children’s Health Insurance Program. The instant you graduate, you switch from a full-time student to a no-time student, and 23 suddenly becomes 19.

Pennsylvania passed a law in 2009 meant to cover people in that situation, but it is ultimately inadequate and without any method of enforcement.

The law allowed them to stay on a parent’s insurance plan until their 30th birthday but required they remain single, not claim any dependants on their taxes and either live in Pennsylvania or attend college full-time. Most importantly, the parent’s insurance company must opt-in to the law.

While even thinking about the finer details of insurance tend to result in blank stares, it’s important to acknowledge they actually exist. The age extension will allow most current college students to ride out their 20s, mostly void of premiums and deductibles, but eventually – whether at 19, 23 or 26 – everybody is going to have to face the harsh reality of health insurance.

Zack Shapiro can be reached at zack.shapiro@temple.edu.