Care in college and beyond
Changes in health care coverage make it easier than ever
by Danny Mensh
While protecting income and preserving wealth through life, disability, and long-term care insurance are essential factors of any financial budget, a major area of concern for families continues to be health insurance coverage. In particular, there are several elements to consider — and several options available — for older children and college students.
Insuring kids in college
Parents of recent college graduates or those who are in college but no longer maintain full-time status must be aware of several important items with respect to their health plans. While a majority of health plans will cover a child-student until they’re 25, some will dip as low as 23. There also can be unforeseen snags that can create significant problems.
For example, let’s say a 20-year-old college student who has been covered under his or her parents’ health coverage switches from full-time to part-time status. If this student incurs a claim, then the insurance company can deny payment even if the parents have been paying premiums since the child changed his or her status. The key here is to remain responsible and vigilant of your health plan and the status of your child-student in order to ensure that the policy still covers him or her for claims.
Another potential pitfall is if a college-age child gets married. At the point that the marriage occurs, the insured child is immediately removed from his or her parents’ plan and must have his or her own policy, regardless of age.
Again, the message here is that parents must be aware of the triggers for children’s coverage and should take proactive steps to move their kids to new employer or COBRA plans, State Continuation, or an individual policy.
There also are several options to consider for college graduates older than 26 who no longer are insured by their parents’ policies.
“Approximately 80 percent to 90 percent of this age group will qualify for individual coverage through medical underwriting,” says Paul Spanos, owner of Community Employee Benefits Inc. in Winston-Salem.
“However, there is always that percentage of kids who have some sort of medical history that might preclude them from passing the medical review,” he adds. “For these individuals, we have COBRA or State Continuation, which is guaranteed.”
These programs are available to those who have reached their age maximum, as well as to employees who qualify through involuntary termination from an employer.
Due to the American Recovery and Reinvestment Act of 2009, which became effective last March, the federal government will pay 65 percent of COBRA or State Continuation plan costs for up to nine months for those who have suffered early termination prior to December 31, 2009. This law greatly helps reduce the typically high cost of these alternative health plans during the current economic downturn. To qualify for federal assistance, residents must meet income requirements and must not be eligible for any other group or Medicare coverage.
Increased coverage options
Another area of concern is for those who are ineligible for Medicare but have exhausted COBRA and State Continuation benefits and have a medical history that precludes them from securing an underwritten individual health policy.
In January, the state launched the North Carolina Health Insurance Risk Pool, a program that allows an increased number of people access to coverage. To become eligible, subjects must be ineligible for employer plans, Medicare and Medicaid; must be medically unable to qualify for traditional individual policies; and must be federally defined as eligible for HIPAA. To learn more about this new coverage, visit www.inclusivehealth.org.
There continue to be loopholes and problem areas for people of all ages and with varying medical histories specific to health insurance. If you haven’t already done so, find a qualified agent to navigate you through the process. In the meantime, stay tuned for changes from insurance carriers and the government that might affect you, your children, your parents, or your business.
For specific questions about these topics, e-mail email@example.com.
About the expert
Danny Mensh entered the insurance industry in 1996 and became president of Mensh Insurance in 2007, taking over a family business that has been in existence since 1968. With more than 10 years of experience, Mensh is certified in long-term care and brings an independent approach to discussions concerning life and disability insurance for individuals and businesses. Planning topics range from protecting income due to disability or premature death to estate planning and preservation measures.
Mensh has appeared on radio and has filmed various educational programs on insurance issues, and has written articles in local and regional magazines on the topic. He received a Bachelor of Arts degree from Duke University in Durham and is active in the Duke Alumni Association in North Carolina. He also is a member of the National Association of Insurance and Financial Advisors, National Association of Health Underwriters, and American Association of Long Term Care Insurance. To learn more, call (336) 631-5503, e-mail firstname.lastname@example.org or visit www.menshinsurance.com.