Health insurance for students and young adults

Here are seven options to get health coverage for young adults.

Stay on your parents’ or guardians' health insurance

Staying on a parent or guardian's health insurance is likely the lowest-cost method for young adults to get coverage.

The ACA lets children stay on their parents’ health plan until the age of 26. That's true even if you are at college, get married or move out. However, if you move far away, the plan may not have a provider network in your new area.

Pro: Cheapest way to get health insurance until age 26.

Con: If you’re going to college or live out of state, the plan may not have providers in the area.

Join an employer's plan

Employers remain the most common way Americans under retirement age get health insurance. You can sign up for a health plan with your employer when you’re first hired, during open enrollment or a special enrollment period. Employers have open enrollment periods each year when employees can change their health insurance and other benefits.

Special enrollment periods are when an employee experiences a qualifying event. These events include getting married and having a child. If you have a special enrollment-qualifying event, contact your employer to find out about health insurance options.

Pro: Cheaper than coverage on the open market.

Con: Coverage can take up a significant portion of your salary if you’re just starting out and not making much money.

Ask about a college health plan

Colleges also often provide health insurance. These plans may be of interest if you’re going to college outside of your state.

If you’re going to school away from home, check your health insurance’s provider network and see if local providers are part of the plan’s network. If not, you may want to sign up for a college plan while you’re in session.

If you’re going to school outside of the country, your parents’ health plan likely won’t cover you. In that case, you should look at the college plan or check out travel insurance.

Pro: Plans are usually inexpensive and offer a provider network for that area.

Con: College plan’s provider network likely doesn’t include doctors in your home area if your school is in another state.

Individual health insurance and ACA plans

You can get individual health insurance through the ACA exchanges or directly from the insurer outside of the exchanges.

ACA plans are eligible for government subsidies that help reduce the costs of health insurance.

Your household income must be below 250% of the federal poverty level to qualify for subsidies. That’s about $32,000 for an individual for 2021. ACA plan members with household incomes below 400% of the federal poverty level can also qualify for tax credits to help pay for health insurance.

Pro: Comprehensive benefits and you may qualify for subsidies to help pay for an ACA plan.

Con: Plans can be expensive if you don’t qualify for subsidies.

Consider a catastrophic health plan

People under 30 are eligible for a catastrophic health plan. These plans have low premiums but exorbitant deductibles. You can buy a catastrophic plan through the ACA exchanges.

Deductibles for catastrophic plans are more than $8,000. Other than preventative care a limited office visits, the plan doesn't cover anything until the deductible is met. After that, the plan pays all of the health care costs. You won’t have to pay a copay or coinsurance.

Catastrophic health plans cover the 10 essential health benefits found in ACA plans, including emergency, outpatient, labs, mental health and prescription drugs.

A catastrophic health plan can be a wise choice if you’re young, healthy, don’t take prescription drugs and don’t need more than an annual check-up.

Pro: Low premiums and the plans are a safety net that’s better than not having any insurance.

Con: Out-of-pocket costs can be substantial before you reach the deductible.

Find out if you qualify for Medicaid

Medicaid is a federal/state program that offers comprehensive coverage at free or low costs for those who qualify.

Thirty-eight states expanded Medicaid since the ACA, which opened up Medicaid to millions of more Americans. To qualify for Medicare, you must meet income requirements.

Medicaid offers the same comprehensive coverage found in Medicare and employer-sponsored health plans. And that comes at little to no cost if you qualify.

Pro: Plans are comprehensive and cost little to nothing depending on income if you qualify.

Con: Fewer providers accept Medicaid than employer-sponsored insurance and Medicare, so you may have trouble finding a provider in your area.

Buy a short-term health plan

Short-term health plans are available in nearly all states. These low-cost plans aren’t technically health insurance since they don’t offer the health coverage found in insurance plans.

Short-term plans don’t usually provide mental health, prescription drug, pregnancy and other standard health insurance coverage. Short-term plans also have large out-of-pocket costs when you need care and can cap coverage.

Another potential barrier is that not all states allow the plans. California, Hawaii, Massachusetts, New Jersey and New York forbid short-term plans. Colorado, Delaware, the District of Columbia, Illinois, Maryland, New Mexico, Vermont and Washington limit its length.

Pro: Low premiums.

Con: Limited coverage and substantial out-of-pocket costs.

Having health insurance is critical -- even for those who are young and healthy. One health emergency can put you heavily into debt, which is the last thing you need if you have college loans. Plus, having coverage lets you get preventive care and receive the necessary health care you may need over the year. Don't go without insurance; shop around and find the right plan for your needs.