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Providing catastrophic medical insurance for adult children
Old 11-28-2009, 08:55 PM   #1
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Providing catastrophic medical insurance for adult children

Okay, here's a case I'm, uh, "aware of":

A gal turns 21 and is no longer under Mom and Dad's medical insurance. She earns about $200/week and is barely getting by. She is not their dependent. She is not going to school. Her employer offers no medical coverage.

She's not worried. Apparently young adults never get seriously ill or have car accidents, etc. "The people I work with just get Medicaid."

In her state, she might have earnings low enough to qualify for State medical assistance.

Mom and Dad know that, although she's an adult and can make her own decisions, they will pay any medical expense needed to assure she stays healthy. But, Mom and Dad don't have $200K in spare cash to pay for these expenses. Of course, neither did they budget for another insurance premium.

Can a parent buy a high deductible plan on the individual market to pay the medical expenses for a non-minor child? Would such a policy make the child ineligible for Medicaid? Is there a smarter way for a parent to protect themselves and their kid from stupid decisions and budget-breaking medical expenses?

Of course, this is just a hypothetical question . . .
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Old 11-28-2009, 09:27 PM   #2
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Quote:
Originally Posted by samclem View Post
Okay, here's a case I'm, uh, "aware of":

A gal turns 21 and is no longer under Mom and Dad's medical insurance. She earns about $200/week and is barely getting by. She is not their dependent. She is not going to school. Her employer offers no medical coverage.

She's not worried. Apparently young adults never get seriously ill or have car accidents, etc. "The people I work with just get Medicaid."

In her state, she might have earnings low enough to qualify for State medical assistance.

Mom and Dad know that, although she's an adult and can make her own decisions, they will pay any medical expense needed to assure she stays healthy. But, Mom and Dad don't have $200K in spare cash to pay for these expenses. Of course, neither did they budget for another insurance premium.

Can a parent buy a high deductible plan on the individual market to pay the medical expenses for a non-minor child? Would such a policy make the child ineligible for Medicaid? Is there a smarter way for a parent to protect themselves and their kid from stupid decisions and budget-breaking medical expenses?

Of course, this is just a hypothetical question . . .
I have a friend that bought health insurance for his young adult son until the son was nearly 30 and finally had health insurance at a job. It was fairly inexpensive. In many if not most states a young adult uninsured person would not be eligible for medicaid unless she became totally disabled. She might be wrong about her impression about medicaid; it might make sense to quiz her on that issue.
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Old 11-28-2009, 09:34 PM   #3
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Quote:
Originally Posted by samclem View Post
Okay, here's a case I'm, uh, "aware of":

A gal turns 21 and is no longer under Mom and Dad's medical insurance. She earns about $200/week and is barely getting by. She is not their dependent. She is not going to school. Her employer offers no medical coverage.

She's not worried. Apparently young adults never get seriously ill or have car accidents, etc. "The people I work with just get Medicaid."

In her state, she might have earnings low enough to qualify for State medical assistance.

Mom and Dad know that, although she's an adult and can make her own decisions, they will pay any medical expense needed to assure she stays healthy. But, Mom and Dad don't have $200K in spare cash to pay for these expenses. Of course, neither did they budget for another insurance premium.

Can a parent buy a high deductible plan on the individual market to pay the medical expenses for a non-minor child? Would such a policy make the child ineligible for Medicaid? Is there a smarter way for a parent to protect themselves and their kid from stupid decisions and budget-breaking medical expenses?

Of course, this is just a hypothetical question . . .
It's enough to turn a parent's hair white.

Wish I had the answer for you! I never could figure out a good solution to a similar dilemma, which is now resolved. My daughter just married a man with many fine qualities, one of which is that he has a secure job with medical insurance, thank goodness.
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Old 11-28-2009, 10:00 PM   #4
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A parent can certainly pay for the policy that an adult child has applied for in their name (the child's). What specific impact that would have on Medicaid I couldn't venture an opinion.
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Old 11-28-2009, 11:52 PM   #5
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Thanks all for the input so far.

Quote:
Originally Posted by Martha View Post
I have a friend that bought health insurance for his young adult son until the son was nearly 30 and finally had health insurance at a job. It was fairly inexpensive.
Well, Dad's employer offers temporary insurance for kids who no longer fall under the umbrella policy. It is about $320 per month for good coverage ($150 annual deductible, 25% co-pay, $3k annual cap).

Quote:
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In many if not most states a young adult uninsured person would not be eligible for medicaid unless she became totally disabled. She might be wrong about her impression about medicaid; it might make sense to quiz her on that issue.
The co-workers might have been single moms or have other factors that put them in a different category from her. I doubt that she has given this much attention. "It will be all right."

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It's enough to turn a parent's hair white.
Yep, or at least the hairs that haven't been pulled out already

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Originally Posted by W2R View Post
My daughter just married a man with many fine qualities, one of which is that he has a secure job with medical insurance, thank goodness.
Has he got a brother?
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Old 11-29-2009, 08:39 AM   #6
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Dad might do better in the private insurance market looking for insurance for her. I would think that dad could find a high deductible policy with premiums far less than what dad's employer would charge. But she would have to be underwritten.
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Old 11-29-2009, 10:11 AM   #7
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Yep, or at least the hairs that haven't been pulled out already

Has he got a brother?
No, and for the past TEN years she has gone bare with respect to health insurance.

I couldn't get her to take out a high deductible policy because she was getting about half off her medical bills (including emergency room, surgery, etc) due to having no insurance. According to her many/most young people who don't automatically get insurance through their employers are just going bare like that. (Remember hearing that line when she was in junior high? "But Ma, everybody's doing it!")

I tried but couldn't talk any sense in to her, even though I pointed out to her that one kidney transplant and my resources would be toast. And yet I could only take the argument so far, because she has been (otherwise) financially independent and completely self-supporting for well over a decade, and does not tolerate what she perceives as her mother pushing her around and treating her like she doesn't know anything. Given that she had a hard time adjusting to her father's and my divorce, I pushed it as far as I could without endangering our relationship but with no success.

Thank goodness that is all behind us - - and she posted on her blog that she received and now has her very own medical insurance card, now, on her husband's insurance.
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Old 11-29-2009, 01:54 PM   #8
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I bought health insurance for my son for a couple of years and currently pay for insurance for my daughter. I view this as self insurance. Think about what you would do if your kid came down with cancer and was uninsured. That could be a ticket to blow your hard earned savings. This happened to my brother - luckily he got his son covered post facto or my he would have spent all of his savings. How many of us would abandon our children to medicaid?
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Old 11-29-2009, 01:57 PM   #9
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Thanks goodness it is not expensive to insure these ferocious and invincible youngsters. It is for our own health insurance that it really hurts.
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Old 11-29-2009, 04:36 PM   #10
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My 25 year old son aged off of our medical insurance this summer and we bought an individual policy for him thru Medical Mutual. It has a 2500 deductible and only runs us $130 a month. He graduates from college in a few short weeks and we will continue to carry it until he has it thru an employer. He will be an athletic trainer and he has an interview with a hospital system here in NE Ohio this Friday...fingers crossed!
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Old 11-29-2009, 07:08 PM   #11
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If she lived in Massachusetts she would have been eligible for free health insurance based on her 10K of annual income. The premium will go up to $116/month for up to 32K of income.
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Old 11-29-2009, 07:25 PM   #12
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If she lived in Massachusetts she would have been eligible for free health insurance based on her 10K of annual income. The premium will go up to $116/month for up to 32K of income.
What does MA include when calculating income?
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Old 11-29-2009, 07:41 PM   #13
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What does MA include when calculating income?
Income from all sources including, SS, Interest and dividend, rental income etc.....

This coverage is essentially for low income people that cannot afford to buy health insurance since MA has mandated health coverage for all residents.
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