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Here’s What You Need to Know About Health Insurance as a First-Time Applicant

CNBC’s Annie Nova recalls her 21st birthday, revealing that she was out with a friend enjoying a long overdue drink when she (the friend) suggested that it was probably the last huge birthday she’d have in a really long time.

As the reporter puts it, the revelation left her feeling sulky, and quite frankly, sad. But as she turns 26, she reckons that her friend may have gotten her time wrong.

They’re both going to achieve the milestone within a few weeks of each other, and they find themselves in another significant period of their lives. This time around, it is even more significant than the freedom to buy yourself a drink.

The Affordable Care Act

Before 2010, most company insurance plans covered dependents throughout their college lives, leaving them to fend for themselves thereafter. However, the Affordable Care Act of 2010 compelled employers to cover them till they turned 26, which was a huge relief for this cohort.

Before 2010, most company insurance plans covered dependents throughout their college lives

As you can already deduce, this CNBC reporter has never really had to go out of her way to pay for medical expenses, unless you want to consider the odd co-payments. This kind of puts you in a comfort zone, don’t you think?

She isn’t alone either, with the government estimating that over two million dependents aged between 19 and 25 are covered by their parents’ workplace plans.

Recently, another friend revealed that the plan her parents were on allowed her to remain covered for a while even after turning 26.

Upon inquiring from her dad whether the same was possible for her, Nova quickly received a reply in the negative. In fact, he told her that she would be on her own after her birthday month, which unfortunately for her, is in January.

Come February 2020, our dear Nova will have to pay for her own medical services, and she’s as confused as anyone in her position would be.

Our reporter, therefore, sought advice from a healthcare expert who shed more light on the issue. According to Caitlin Donovan of the Patient Advocate Foundation, finding the right insurance plan for yourself is not a difficult process. However, she admits that it could be quite tedious.

A Qualifying Event

As a rule though, the moment coverage by your parent’s employer runs out, your employer has to enroll you into their plan, regardless of whether they’re on open enrollment or not. This, as Nova discovered, is referred to as a qualifying event.

A qualifying event translates to immediate enrollment in your employer’s plan

To this end, experts advise that you shouldn’t catch your employer by surprise. To be on the safe side, notify them at least thirty days before you lose coverage from your parents’ insurer. By letting them know, they’ll advice you on what exactly you need for the enrollment and when the time comes, it will be a smooth transition.

In Nova’s case, CNBC’s policy requires you to sign up to the company’s insurance within 31 days of losing your parents’ coverage.

If your job offers no coverage, there’s always the marketplace option

If your job does not offer insurance, you should take out a marketplace plan anytime within sixty days before turning 26 and a similar number of days after celebrating your birthday.

Depending on whichever plan you’ll be on, you will have to make monthly payments, otherwise known as premiums. A premium should not be confused for a deductible as the latter is the amount you’ll have to fork out before the insurance plan comes to your aid.

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