Young adults seeking coverage on parents' plans face obstacles

Young adults and their parents eager to take advantage of a new law that will allow parents of children up to age 26 to keep their children on their health plans are facing obstacles in learning even exactly when they'll be eligible.

Kaiser Health News: Though the provision goes into effect in September, children of federal workers won't likely be eligible to go on their parents' plans until next year, when the new plan year begins in the Federal Employees Health Benefits Program. "That means the government, which is the largest employer in the nation, will not follow the lead of some private insurance companies that will begin offering such coverage to young adults by June 1." Those insurers who said they will begin offering such coverage for young adults include United Healthcare, WellPoint, Humana, independent Blue Cross and Blue Shield plans and Kaiser Permanente. The Office of Personnel Management says federal law doesn't allow it to offer such coverage to federal workers' children before the September start date (Marcy, 4/27). McClatchy also has a version of the story.

The Associated Press/The Washington Post: The IRS and President Barack Obama are pushing for early adoption of the young adults provision. "On Tuesday, the IRS issued a notice reassuring employers that neither they nor their workers would face negative tax repercussions from expanding coverage immediately. Some businesses weighing whether to act now had worried that traditional tax breaks for employer-sponsored health care might not apply." But even if employers begin offering the new coverage for young adults, what remains unclear is how much insurance plans will charge for it (Alonso-Zaldivar, 4/27).

CQ Healthbeat: The IRS notice Tuesday said employers who offer cafeteria plans, those with a "menu of tax-free benefit options" may allow pre-tax salary reductions in order for employees to pay for covering their children. "Separately, White House Office of Health Reform Director Nancy-Ann DeParle listed insurers on her blog who have agreed to cover young adult children before Sept. 23, the date they are required to do so under the law" (4/27).

In the meantime, other groups are weighing in on what the implantation of the health law means for them.

Kaiser Health News, in a separate story: Small businesses have split views on what new tax credits will mean for them. "The U.S. Chamber of Commerce and the National Federation of Independent Business say the tax credits, which will provide a credit worth 50 percent of an employer's contribution toward employee health insurance premiums for the smallest firms, will actually do little to help small businesses afford health insurance." Others, however, are eager to take advantage of the provisions, which are available in full to small firms with 10 or fewer employees and phase out up to firms with 25 employees. Small Business Majority CEO John Arensmeyer said "small businesses will for the first time be able to compete with large ones in terms of the type of health coverage they offer. Right now, he said, small businesses pay 18 percent more on average than large businesses in health care costs" (Villegas, 4/27).

Farm workers, too, are worried about how the health law will help them. NPR reports about questions workers in California have. More than 70 percent of them are uninsured. "The new health care law will benefit many of those workers through an expanded Medi-Cal program and government subsidies to buy private health insurance." What remains unclear, however, is how mandates to purchase coverage will affect workers, especially those who are undocumented (Varney, 4/28).

The Wall Street Journal's Health Blog: Retailers, too, face uncertainties. "[A] report by Mercer finds that retailers may be in the not-so-sweet spot when it comes to complying with some of the new employer requirements. The consultancy analyzed data from its annual survey of employer health plans and found that 62% of retailers face problems with at least one of three big requirements of the new law: to provide 'affordable' coverage, to offer coverage for part-time employees working at least 30 hours per week, and to go above and beyond the limited benefit plans sometimes offered to part-timers" (Hobson, 4/27). 

Bloomberg Business Week: And the White House is weighing in on the debate about repealing the health law. White House health care adviser Ezekiel Emanuel said threats to repeal aren't a "realistic possibility." He was speaking at a Bloomberg conference in Chicago. "Republicans aren't going to win control of both houses of Congress with veto-proof majorities, he said. And President Barack Obama 'certainly isn't' going to sign a repeal, he said. … While many of the provisions in the bill don't take effect until 2014 or later, Emanuel said that health systems are already preparing for it and changing their practices. He said he expects the Cadillac tax (a tax on high cost insurance plans) to have an effect well before it comes into play in 2018" (Jensen and McCormick, 4/27).