Many Graduates Lack Health Insurance

By Staff
July 21, 2009

In addition to facing a tough job market, many new graduates are also living without health insurance coverage.

USA Today reports that according to the National Association of Colleges and Employers, about 1 million alumni dropped their parents' health insurance coverage upon graduating this year. But because so many new graduates are having difficulty obtaining employment that includes health benefits, a significant number of young adults are not adequately insured.

CNBC reports that according to the Centers for Disease Control and Prevention, one-third of adults ages 20-24 was uninsured in 2006--the highest percentage of any age group.

"People generally put off health insurance because it's not mandated," explained Steve Trattner, chief marketing officer at Cinergy Health. "It's just one of those necessary evils."

Cheryl Fish-Parcham of Families USA, a health care advocacy organization, told USA Today that delaying health insurance is unwise for graduates, as unexpected medical issues can create significant debt. Moreover, she noted, insurers may deny coverage if graduates develop any major medical problems. For this reason, she advised avoiding gaps in coverage lasting more than 63 days, because within that period of time, federal law requires insurers to offer coverage.

One possible option for graduates is to remain on their parents' health plan. Sara Collins, vice president at the Commonwealth Fund, told USA Today that 25 states allow this, and graduates can sometimes stay on their parents' health plans until age 24, 25 or 26. New Jersey boasts the highest age limit at 30.

Legislators in New York recently approved a bill aimed at addressing this problem. The new law would grant health insurance coverage to unmarried adult children up to age 29 under their parents' policies, reports the Post-Standard in Syracuse. Currently, health insurers may remove young adults from policies at age 19.

"We see this as a really good option for moderate and middle income families," said Elisabeth Benjamin of Health Care for All New York, a coalition that is pushing for universal coverage.

Some other options to consider include extending a college health insurance plan or purchasing an individual insurance policy. Depending on the state and the amount of coverage, individual plans can vary by hundreds of dollars monthly.

Yet any health coverage is better than nothing at all, said Jessica Vistnes, senior economist for the government's Agency for Healthcare Research and Quality, who was quoted by CNBC.

"Even if it has a high deductible," she said, "having catastrophic coverage is important to protect against the unforeseeable."

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