Cover Me!

Health Insurance Coverage for Adult Children Extended!

Did you know that a new law took effect on September 23, 2010 that allows a parent to provide health insurance for his or her children up to age 26?

The law, which applies only if your employer already provides dependent coverage, would cover adult children even if they are not in college, do not live at home and are not claimed as dependents on a parent’s tax return. Coverage even includes married dependents but not their spouses or children.

Coverage also allows children who are under 26 but who were previously dropped from coverage, to re-enroll as long as they do not have access to an employer-sponsored plan. If a company has a plan that offers dependent coverage, it must inform employees that their children who may have aged out are eligible again starting January 1, 2011.

Insurance companies cannot increase the cost or limit coverage for the under 26 group, but parents may face an across-the-board increase in the cost of coverage for adding dependents to their plan.

If you are legally separated, have dependent coverage and plan to cover your adult children, you may want to consider waiting to file for a divorce since there is usually no additional cost to cover a spouse as long as you are separated but not divorced. And for couples trying to find a way to manage their finances while living separately, saving on the cost of health insurance will certainly help.