Bloomberg News

Health Law Adds 6.6 Million Young Adults to Parents’ U.S.

June 08, 2012

Health Law Adds 6.6 Million Young Adults to Parents’ U.S. Plans

Doctors and other medical professionals outside the US Supreme Court during the start of arguments challenging the constitutionality of the Obama administration's 2010 health care reforms, on March 26, 2012 in Washington. Photographer: Brendan Smialowski/AFP/Getty Images

About 6.6 million young adults under age 26 joined their parents’ insurance plans in 2011 because of the U.S. health-care law, the largest one-year increase in medical coverage for the age group, a survey found.

The part of the law that lets young people stay on parental plans until age 26 helped boost coverage during tough economic times, said Sara Collins, vice president for affordable health insurance at the Commonwealth Fund, a New York-based nonprofit that conducted the survey and supports expanded health coverage.

The benefit for adult children is one of the most popular parts of the 2010 health-care law as young adults face a U.S. labor market that is making it more difficult to find work and garner health coverage. Unemployment among 16- to 24-year-olds was 16.1 percent in May, almost double the 8.2 percent rate for the nation as a whole, according to government data.

“The economy is absolutely a factor in both the large number of adults who are without health insurance and likely the number coming onto their parents’ policies,” Collins said in a telephone interview. The health law “came at a really good time for young adults, in terms of the poor job market.”

Young adult coverage was one of the first provisions of the law enacted. About 71 percent of Americans polled by the Kaiser Family Foundation in April said they viewed that provision favorably. The health law in its entirety is less popular, with an approval rate of 37 percent, and an unfavorable view by 44 percent of those surveyed in May, according to a monthly tracking poll by Kaiser.

Republican Support

President Barack Obama’s almost $1 trillion, 10-year plan to overhaul the health system passed Congress in 2010 without any Republican votes. Parts of the law expanding insurance coverage were then challenged as unconstitutional by 26 states. The Supreme Court is slated to rule on those objections this month, a decision that may lead to a dismantling of the law.

The head of a caucus of 21 Republican lawmakers with medical backgrounds said this week that no matter the outcome, he will try to preserve the coverage for young adults and for people with pre-existing medical conditions. Representative Phil Gingrey, an obstetrician-gynecologist from Georgia who co-chairs the group, said the young-adult provision is “a good policy.”

The government calculates that about 2.5 million people under age 26 who had been uninsured gained coverage in 2011 because of the health law. Commonwealth’s figure includes people who switched from other insurance to their parents’ plans.

Premium Increase

In May, Health and Human Services Secretary Kathleen Sebelius and Education Secretary Arne Duncan wrote college presidents and student groups asking them to remind graduates that they can join their parents’ plans.

The government estimates the requirement increased health insurance premiums by less than 1 percent. Senator Jim DeMint, a South Carolina Republican who opposes the health law, said today in a commentary on the Joint Economic Committee’s website that the increase is probably as much as 3 percent. He said the provision wouldn’t be needed if the economy were healthier.

“Fewer Americans would need to remain on their parents’ health insurance if they had stable, full-time work,” he wrote.

The U.S. labor market stumbled in May as employers added the fewest workers in a year and the unemployment rate rose.

To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net


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