Last Updated On: August 1, 2023

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Best Health Insurance For Young Adults

Once you reach a certain age, you’re on your own and need to make choices for yourself. This is true even if you’re in college or have recently graduated. Choosing good health insurance plans for young adults is crucial at this stage. So, how do you choose a health insurance plan? Remember that once you turn 26, you’re no longer covered by your parent’s plan.

Suitable Health Insurance For Healthy Young Adults

While reviewing policies, you need to evaluate your own life and circumstances. This will help you choose the right health insurance policy.

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Here’s How to Find the Best Health Insurance For Young Adults?

Did you know that young adults make up the highest uninsured demographic? Roughly 30% of young adults don’t have insurance. Further complicating this disturbing trend is that 1-in-6 young adults have to contend with chronic conditions like diabetes, asthma or even cancer—and without insurance, America’s young people are shouldering a substantial financial burden.

Fortunately, in 2010 the federal government stepped in with the Affordable Care Act (ACA)—a widespread effort to get health insurance to young adults and the rest of the uninsured US population. Now, not only are more people eligible for affordable healthcare, they even have options!

We’re going to tell you everything you need to know about getting health insurance for young adults, starting with some information on how the ACA is making getting coverage easier.

Health Insurance for Young Adults and the ACA

Before 2010, once an adult turned 19 or graduated from college, they were removed from their parent’s health insurance plan and usually left uninsured. Since the health reform in 2010, young adults can stay on their parent’s health insurance plan up until the age of 26, even if these individuals are:

Married
Living elsewhere (not at home)
In school
Financial independent

The other outcome of the health reform is that any American without health insurance must pay a tax penalty. For those that would rather pay the fine, understand this rate isn’t fixed, so will keep climbing.

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10 Essential Healthcare Benefits

As part of the healthcare reform, any plan you enroll in, whether it’s from Marketplace or off-exchange, will cover these 10 essential healthcare benefits:

Health Insurance Enrollment

There isn’t much to it for young adults looking to enroll in their own health insurance plan. The hardest part is deciding whether you’d like to go through Marketplace or off-exchange, and from there, you may need to create an account and/or fill out an application. Just make sure you get healthcare during Open Enrollment or Special Enrollment Periods.

Ambulatory Patient Services (or outpatient care)
Prescription Drugs
Pediatric Services (including dental and vision care for children)
Preventive Care (physicals and immunizations)
Laboratory Services
Emergency Services
Hospitalization (surgery, in-patient, and other conditions)
Mental Health Care And Substance Disorder Services
Rehabilitative And Habilitative Services
Maternity, Pregnancy And Newborn Services

Additionally, all federal health plans usually cover breastfeeding support, birth control, and coverage for pre-existing conditions.

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Health Insurance Options For Young Adults

Alongside the healthcare reform came the willingness of insurance companies to offer attractive health insurance policies for young adults to incentivize them to get their own plans. Some of the health insurance plans for young adults include the following options—keep reading!

Free Or Low-Cost Health Insurance Options

Parent’s Health Insurance Plan: If you can’t afford to strike out on your own or are comfortable remaining on your parent’s coverage, then you can until you reach 26—then it’s time to start considering alternatives.
Employer-Sponsored: For young adults offered employer-sponsored health insurance for free or at a low cost, this could be a viable alternative. With employer-sponsored health coverage, you have the option of adding dependents, and the employee contribution is usually pre-tax, making this a popular way for Americans to receive health insurance.
Qualifying For Medicaid: For Americans who require low-cost or free health insurance, applying for federal and state-funded Medicaid is a good solution. However, to be eligible, you’ll need to check your state requirements—the most common requirement is your income needs to be 100%-200% between the federal poverty line (FPL).

Private Health Insurance Choices

Marketplace: If you don’t qualify for Medicaid, at any point, you can turn to Marketplace to shop, compare and figure out which policy is right for you. Although the Marketplace is federal, some states choose to run their own state Marketplace, like California.
All government-run Marketplace plans are eligible for tax credits and possible subsidies (based on income), meaning cheaper premiums. Marketplace plans are metallically tiered (bronze, silver, gold, platinum) and ACA-compliant.
Catastrophic Coverage:Some states allow young adults (under 30 years old) to purchase what they call catastrophic coverage through Marketplace. This coverage is still ACA-compliant, offers low premiums (below that of bronze plans) and high deductibles. For healthy young adults willing to pay out-of-pocket expenses (since you usually only get three doctor’s visits before reaching your deductible) this could be the right coverage for you.
Private Health Insurance Or “Off-Exchange”: The next option is purchasing health insurance through private health exchanges. These “off exchanges” are ACA-compliant, but you won’t get subsidies or tax credits since you’re enrolling through a private insurance company, not a government-run Marketplace. The benefit of using a private provider is that you can work closely with a licensed agent who is highly skilled at finding you the best possible plan.
We can connect you with one now. We’ve curated a list of the best providers who offer health insurance for young adults—including off-exchange providers—so all you have to do is request a quote now.
College Health Insurance: The final option that young adults may not realize they have is health insurance through their college. Typically this is offered to full-time or graduate students. Young adults should strongly consider getting health insurance from their school if they’re attending a school away from their home state. This will give them the coverage they need so they can focus on their studies instead of worrying about health insurance.

Short-Term Health Coverage

If you missed Open Enrollment and need health insurance right now, you can purchase short-term health coverage as a stop-gap until Open Enrollment resumes. Some features of short term health insurance are:

Affordable premiums
Apply anytime
Not ACA-compliant (some coverages not available, like preventative care)
Won’t cover pre-existing conditions
Usually effective for up to 364 days

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Finding The Best Health Insurance for Young Adults

When it comes to determining which healthcare insurance you’d like to enroll in (outside of staying on your parent’s plan), you should first assess your needs. Some of the things to consider are:

Health: If you have any chronic health conditions that require more frequent medical attention, then you’ll need to find coverage that will keep your out-of-pocket expenses down. If, however, you’re in good health, then you can opt for lower premiums and pay for medical costs on an as-needed basis.
Income:How much you can comfortably afford will likely be a deciding factor for young adults. But, while you’re crunching numbers, you should investigate which money-saving options are available to you.
Dependents: For young adults with dependents or a spouse, you’ll need a plan capable of caring for your entire family. This could mean Medicaid, employer-sponsored, or a mid-level Marketplace Plan.
State: Where you live is also something to consider as state-based Marketplaces are ACA-compliant, but there could be differences. State-run Marketplaces provide all 10 essential healthcare benefits, but they reserve the right to:
- Handpick insurance companies allowed to offer health insurance
- Cap the number of insurance companies that provide health insurance
- Not offer non-essential treatments, like infertility treatment
- Not expand Medicaid so more low-income families can utilize it

Once you’ve figured out the type of healthcare plan you want to enroll in, the next step is comparing the different plan options available to you—e.g., between the Marketplace tiered plans.

You can narrow down the playing field by comparing plans based on:

Premiums: The most straightforward way to compare plans is by looking at the premium costs—just be sure to factor in any subsidies or tax credits for which you’re eligible.
Out-Of-Pocket Expenses: Don’t just lock onto the cheapest policy because you may pay more out-of-pocket for routine medical care like check-ups.
Emergency Reserves: Life happens. If you hurt yourself or get sick, how much money can you afford to pay in out-of-pocket expenses before your insurance kicks in?

The Takeaway: Health Insurance For Young Adults

One of the most important things a young adult can do is protect their health by getting health insurance. With so many options available, securing the best plan for your needs is as simple as doing a little research and then choosing an option that gives you the coverage and peace of mind you require.

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FAQ

What's the difference between Marketplace and Off Exchange health insurance?

Both Marketplace and off-exchange plans are ACA-compliant, but that’s where their similarities end. If you go through the state or federal Marketplace, you may be eligible for tax rebates or cost-sharing, but off-exchange plans come from private insurance companies, so they don’t come with rebates.

How can I find out if I'm eligible for tax rebates or cost-sharing?

When you’re applying for Marketplace health insurance, you’ll find out if you’re eligible for tax rebates or cost-sharing during the application process.