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How to Engage with Employees Aging Out of Their Parents’ Health Plan

Oftentimes, the best candidates to fill your entry level positions are recent college grads in their early 20s.

If they’re typical millennials, they’re eager to hit the ground running. And generally in good health. So health insurance may not even be on their radar.

For most of their lives, these employees have had health insurance through their parents’ plans. But when they’re no longer eligible for coverage under their parent’s plan, will they be ready to transition to their own coverage?

Here are a few tips to get younger employees engaged in learning about their options so they can choose the right plan for their needs.


Give them notice

The first thing you can do to support employees is to make sure that they’re not blindsided by a sudden gap in health coverage.

Most dependents are able to stay on their parents plan until they are 26. But if their parents qualify for Medicare before they turn 26, they’ll have to find their own plan sooner.

Some companies send notices by email or regular mail to parents in their organization, informing them of their children’s coverage end date. If you’re a benefits manager, consult the terms of your organization’s plan and consider sending similar messages to employees about to age off their parents’ plan. Give them a couple of months’ notice so they have time to consider their choices.


Provide the right information

You may also want to include information about the timeline and process for transitioning to a new plan.

Consider hosting periodic group informational sessions. If there are individual questions, your answers will be heard by other young employees who may have similar concerns. Or if you only have a few younger employees in your office, offer to meet with them one-on-one to review their options.

Create a handout that details the steps they need to take. And post the steps on your employee portal if you have one. Include your contact information in both places so they know where to turn for help.

Most importantly, let them know that health insurance is important for maintaining good health. It gives them access to timely and preventive care that’s affordable.


Go over their options

Younger employees looking to transition to their own coverage have many options, including:

  • Applying to get an 18 month extension for staying on their parents plan through the Consolidated Omnibus Budget Reconciliation Act (COBRA)
  • Enrolling in an individual Affordable Care Act (ACA) plan
  • Signing up for their employer’s group plan

In order to determine exactly when younger employees aging out will lose coverage, they’ll have to find out about their parents’ insurance.

And employees turning 26 can take advantage of a Special Enrollment Period, because turning 26 is considered a qualifying life event. During this period, they can enroll in their employee health plan.


Benefits of employer coverage

If you’re helping your younger employees navigate this important decision, and your organization offers them health coverage, let them know the perks of enrolling.

Do you offer employee wellness programs? Can they get a discount on their premium if they are a non-smoker? Do you offer incentives for physical fitness? Do they get access to workout facilities, wearable fitness technologies, or ant apps that track exercise progress?

Wellness is a major part of many millennials’ daily lives. They exercise more, eat smarter and smoke less than previous generations. They also use apps to track training data, and search online information to find the healthiest foods. So these features may matter to them.

Millennials also tend to be more frugal than other generations. So they may be attracted to the tax-advantaged savings offered by a high deductible health plan paired with a health savings account (HSA). According to some sources, an HSA could be a great solution for millennials who don’t have a huge need for high-end health insurance.


Stay engaged throughout the process

As a benefits manager, the best thing you can do to help younger employees transition is to stay engaged in the process until they’re enrolled in their new plan. Provide them with the right information up front and be available to answer questions via email, phone, or in person. And make sure they know how to maximize the benefits offered through their plan.

By investing a little time, you can help your employees make benefits decisions with confidence.