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Health Insurance for Young Adults Explained

Health Insurance for Young Adults Explained

Al Waller: Maintaining health involves taking care of ourselves and having access to health insurance. Yet, research from Transamerica Institute shows that 32% of Americans in their 20s do not have health insurance. Without access to medical care, it can be difficult to maintain our health and prevent unexpected medical expenses.

For many young adults, dealing with health insurance can be confusing and burdensome— the good news is that it doesn’t have to be!

Welcome to ClearPath – Your Roadmap to Health & WealthSM. I'm your host, Al Waller. Joining me today is Mihaela Vincze, public health expert for nonprofit Transamerica Institute®, and today we’re sharing helpful information on health insurance options for young adults.

Before we get started, I want to remind our listeners that we would love to hear from you and get to know what topics you’d like to hear about. Please drop us a line at [email protected].

It’s a pleasure to have you here, Mihaela.

Mihaela Vincze: And it’s a pleasure to be here, Al.

Al Waller: So Mihaela, can you tell me a little bit about why health insurance is so important?

Mihaela Vincze: Health insurance not only protects our health, but it can also protect us from unexpected costs. If something serious were to happen, you could end up with crippling medical debt. Health care costs are the leading cause of bankruptcy for Americans, according to the Consumer Financial Protection Bureau. Having health insurance helps prevent that.

Al Waller: I have heard many stories of individuals who have fallen sick without insurance and were left with overwhelming debt. It's beneficial to steer clear of such situations.

Mihaela Vincze: It sure is. I had a friend who didn't have access to health insurance. She was working as a freelance photographer at the time and couldn't afford to pay for a plan out of pocket. One day, she got sick and had to go to the emergency room. The bill for her visit was very high, and she had to pay it all herself. She struggled paying for it for months afterward. It was a tough lesson for her to learn but also a reminder of how important it is to have health coverage. According to UnitedHealthcare, the average cost for an emergency room visit without insurance is $2,600.

Al Waller: I'm sorry to hear about your friend's experience—as you just illustrated, it’s really expensive to not have access to health insurance. Besides the financial aspect, are there any other reasons health insurance is important for young adults?

Mihaela Vincze: Yes! Most health insurance plans give you access to free preventive care, such as screenings and vaccines. This greatly reduces the chances of you falling ill in the first place. Further, by identifying diseases early on, you increase your chances of successful treatment.

Al Waller: Another excellent reason, Mihaela. Not only will you spend less money, but you’re also more likely to get better health outcomes by catching illnesses early on. But I do have to wonder, why are you emphasizing the need for young adults in particular to get health insurance?

Mihaela Vincze: Well Al, it’s true that people of any age can benefit from having health insurance. However, today we’re focusing on young adults because of some alarming data. According to a 2019 survey by the US Census Bureau, adults ages 19 to 34 had the highest uninsured rates of any age group in the United States.

Al Waller: That is concerning. Why do you think the insurance rates among young adults are so low?

Mihaela Vincze: There are a number of reasons. For one, many young people view themselves as invincible. However, it’s important to get covered as you never know what will happen—no one plans accidents or chronic diseases. Having health coverage in advance can provide peace of mind and ensure that you receive proper medical attention if the need arises.

Al Waller: Good intel, Mihaela. Hopefully this episode will help young adults understand the importance of health insurance and give them the resources they need to get it. What options are available for young adults, Mihaela?

Mihaela Vincze: When it comes to health insurance options for young adults, there are several options to consider. For example, one frequently utilized option is staying on a parent's insurance plan until age 26.

Al Waller: That sounds like a good option if your parents have a plan in place. What other options are there for young adults?

Mihaela Vincze: Another option is for young adults to get job-based coverage. Many employers offer job-based insurance as a benefit to their employees.

Al Waller: Yes, many employers do offer job-based insurance to their employees. However, it's important to keep in mind that not all employed young adults may be eligible for this type of coverage, especially if they are working part-time.

Mihaela Vincze: Yes, that’s a great point you raise, Al, as only 64% of workers in their 20s are offered health insurance by their employers, according to research from Transamerica Institute.

Al Waller: Yikes. Now, what other health insurance option is available for young adults?

Mihaela Vincze: Another choice for young adults is to look into student health insurance offered by their academic institution, if currently enrolled. It’s worth checking with your school to see if this is a possibility for you.

Al Waller: That’s right, as many universities offer student health insurance, which can be a great way to ensure that students have access to the health care they need while they're in school. What else?

Mihaela Vincze: If you’re a young adult who is married, you may be eligible to join your spouse's health care plan. This can be a great option for those who are looking for comprehensive and affordable coverage.

Al Waller: Joining your spouse's health care plan can be a smart move. What other options are available for young adults to obtain coverage?

Mihaela Vincze: Medicaid can be a great health care option for young adults who meet the eligibility requirements. You can check out our podcast episode Medicaid Explained for more information about this option.

Al Waller: That was a very informative episode! Are there any other options?

Mihaela Vincze: Yes. Through the health insurance Marketplace, a young adult has the option of purchasing a private plan. Marketplace plans can be affordable for many individuals, especially those who qualify for subsidies based on their income. These can function as premium tax credits, which can help lower the cost of monthly premiums, making health insurance more affordable.

Al Waller: Many young adults can benefit from the premium tax credits. Now that we’ve covered many different options for getting health coverage, let’s switch gears. When trying to narrow down what plan to get, what factors should young adults take into account when selecting a health insurance plan?

Mihaela Vincze: When it comes to choosing a health insurance plan, young adults should consider a few key factors. First, it's important to think about your budget and how much you can afford to spend on premiums, deductibles, and other out-of-pocket costs. You should also look at the benefits offered by different plans, such as coverage for prescription drugs, preventative care, and mental health services.

Al Waller: Yes, it’s certainly important to determine what type of benefits are offered by the plan you’re considering. What else should young adults keep an eye out for?

Mihaela Vincze: You'll want to consider the network of doctors and health care providers that are covered by each plan, as well as any limitations on seeing out-of-network providers. It's a good idea to think about your overall health and any specific medical needs you may have, such as chronic conditions.

Al Waller: Those all sound like very important things to think about when you’re deciding what type of plan to get because from a savings perspective, you'll want to shop for plans that fit your need and not go overboard. At the same time, you don't want to scrimp or put yourself at risk just to avoid paying a few more dollars. Any last tips for picking a health insurance plan?

Mihaela Vincze: I certainly do. Here are three of my top tips for picking a health insurance plan:

  • Identify your health-care related needs. Before selecting a plan, reflect on your health care needs. For instance, do you need regular prescription medication? Do you have any pre-existing conditions? Are you planning to have a baby? Thinking about these factors can help you narrow down the type of plan that will best fit your needs.
  • Look at the plan's network. The network includes doctors and hospitals that a plan covers. If you have a preferred health provider or hospital, ensure they are part of the plan's network.
  • Compare costs. Did you know that the cost of a plan is not just the monthly premium? It also includes other elements such as the co-pays, deductibles, and out-of-pocket maximums. Compare the total cost of each plan you are considering.

Al Waller: Well, thank you Mihaela. You’ve certainly given us a lot to consider. Hopefully, those listening (young adults in particular) have a better understanding of why health insurance is important, what their options are, and how to find the right insurance for them. If people want to learn more, where can they go?

Mihaela Vincze: Check out our guide Health Coverage Options for Young Adults, found at transamericainstitute.org for more information.

Al Waller: Well, that’s all the time we have for today. Thank you all for listening. If you’d like to check out any of the source materials mentioned today, visit transamericainstitute.org/podcast to review the episode’s transcript.

If you have comments, feedback, or topic ideas, please reach out to [email protected]. Don’t forget to hit that subscribe button so that you don’t miss an episode of ClearPath—Your Roadmap to Health & Wealth.

Until the next time, I’m your host Al Waller. Stay safe, be well, and thanks for listening.

ClearPath – Your Roadmap to Health & Wealth is brought to you by Transamerica Institute, a nonprofit private foundation dedicated to identifying, researching, and educating the public about health and wellness, employment, financial literacy, longevity, and retirement.

You can find our weekly podcast on WYPR’s website and mobile app, wherever you get your podcasts, and at transamericainstitute.org/podcast.

ClearPath – Your Roadmap to Health & Wealth is produced by the Transamerica Institute with assistance from WYPR.

The information provided here is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical, or financial advice or guidance.

Al Waller is a long-time Baltimore native and employment expert with a 30-year career in leading and advising locally and globally based corporations on matters including: Talent Acquisition and Retention, Employee Relations, Training and Development.
Mihaela Vincze is a public health expert and experienced health care educator. Serving as Transamerica Institute’s health care content developer, she shares insights on health and wellness on ClearPath—Your Roadmap to Health and WealthSM. Mihaela earned her master’s and bachelor’s degrees in public health at California State University, Northridge.