FEHBP changes coverage for adult children

The Office of Personnel Management is working with Congress to implement the health reform law early by allowing health insurance coverage of employees\' adult ...

By Suzanne Kubota
Senior Internet Editor

Under the Affordable Care Act signed in March, adult children up to age 26 will be eligible for health insurance coverage under the FEHBP.

Registered Employee Benefit Consultant, Ed Zurndorfer explained the change for feds under healthcare reform to Federal News Radio.

One of the consequences of the passage of that act is that insurance companies have to..insure… young adults between the ages of 22 and 26 if they are not covered by another plan. As far as the federal health insurance is concerned, until now, if a federal employee had health insurance with the Federal Employees Health Benefits Program, the FEHBP, they had coverage themselves, they could cover a spouse, and they could cover also their children. Their children are defined as children under the age of 18 – 18 or younger, but if a child was in college, full-time student 19 to 22, they also could be afforded coverage, but once that child reaches 22, even if they’re a full student or if they get married, they’re going to lose that coverage. Now under this new law OPM is going to be extending FEHBP, the insurances, to young adults between the ages of 22 through 26, if the young adult is not eligible to join, let’s say, a group health insurance plan.

So, said Zurndorfer, if a young adult living at home graduates from college and gets a job where his or her employer offers health insurance, the child can not opt to stay within the FEHBP.

The federal plan does allow a 22 year old who loses coverage to stay on the FEHB plan for one month at no cost. The child could continue under the FEHB plan for up to three years, however if they stay under the FEHB plan during those three years, the child, I really should say the parent, must pay the full amount of the premiums. That includes the employer portion, the employee portion, plus a two percent administrative charge. That is called the Temporary Continuation of Coverage. Now, under the new law, the 22 year old loses coverage can stay on the parent’s plan through the age of 26, assuming again, the young adult is not eligible for another plan.

OPM notes that under the TCC, “though there is no Federal contribution toward the premium, the coverage policy is not subject to underwriting or pre-existing condition exclusions.”

Coverage for adult children under the new rules in the Affordable Care Act becomes effective January 1, 2011.

As a result of this change, said Zurndorfer, expect rates to increase accordingly. “You put more people into the risk pool, premiums are going to go up.”

For more from OPM, see Temporary Continuation of Coverage at http://opm.gov/insure/health/tcc/index.asp

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