The Adult Children of New Jersey

Garden State tries novel way to keep young people insured

Right now, thousands of people under 30 are crashing their cars. They're getting pregnant, catching STDs, and succumbing to accidents, sports injuries, violence, and self-inflicted harm. One out of three of them is doing these things without the safety net of health insurance. Young adults are the largest and fastest-growing group in America without health insurance, with a rate double that of older working-age adults. The Institute of Medicine says lack of health insurance plays a part in the premature deaths of 1,930 young adults every year.

Kids from the middle class, the ones whose parents have jobs and benefits, can usually stay on their parents' policies until age 19, 23 if they're full-time students. After that, they either have to land a "real job"—and even then they might have to wait six months for benefits—or buy coverage for themselves. Insurance on the private market can cost thousands of dollars a year. State programs for low-income working adults have stringent income requirements: $25,125 a year for Healthy New York, for example.

At some last, legislators across the country are starting to take notice. A new law in New Jersey will make parents' coverage available to offspring as old as 30. Backers of a similar bill that has been stalled in New York say the change next door may give their measure new hope.

illustration: Matthew Martin

Tara, a 25-year-old graduate student at Monmouth University, says she works "extremely part-time" at a seasonal job and currently relies on Cobra—meaning she pays the full tab to keep her health insurance from a previous job. Her mother is a nurse at the New York Times production plant in New Jersey. Tara, who asked that only her first name be used, says she would definitely consider taking advantage of health coverage through her mother's job if it were affordable, say around $200 a month. Cobra normally runs out after 18 months. "I worry about having lost my insurance," she says.

She'll soon have another choice. New Jersey's bill, which was signed into law by the governor last month and goes into effect in May, requires employers to extend health coverage to the 30-and-under offspring of workers, as long as they remain unmarried and have no children of their own. "It's really a home run for everybody," says Assemblyman Neil Cohen, who came up with the idea. "We've been getting calls from all over the country." He says his bill has the potential to cover 100,000 of New Jersey's uninsured.

In New York, Republicans have introduced a bill on four separate occasions since 1999 to raise the age at which a young adult can be covered by a parent's policy from 23 to 25. The bill is currently not active, but a spokesperson from the assembly minority office said he hoped that the passage of the New Jersey law would give it "some traction."

The idea of twentysomethings staying on their parents' plans might sound infantilizing at first blush. News accounts of the law can't seem to avoid using the oxymoronic phrase "adult children" to describe its intended beneficiaries. These are people who are well past the age of majority and often finished with their education, who should be self-sufficient by now. That so many of them can't find employer-based coverage on their own would seem to indicate a larger problem than a stopgap program like this can fix.

As Cohen describes the New Jersey law, it's a win for everyone involved. Private individual insurance in the state can cost $7,000 a year, a price few people are able or willing to pay. These new dependent policies will probably cost between $1,200 and $2,000 a year, a sum close to the actual annual average medical costs incurred by relatively healthy under-30-year-olds. Parents of young adults will get peace of mind. Employers don't shoulder any extra cost, since the premium is paid by the family—in theory, by the so-called adult child. The state will save on the $600 million it spends each year on charity care for uninsured people who show up at hospitals. "When this proposal came through, [all sides] were looking to see what was wrong with this law, but they couldn't come up with anything," Cohen says. "It even benefits the health insurance industry. Now they will have a new revenue source—an additional policy that they didn't have before."

Cohen's brainstorm is the most generous example of a new state approach forcing employers to take responsibility for young people who have been left out in the cold. Other states that have raised the dependency age limit, generally from 23 to 25 or 26, include Utah, Texas, New Mexico, and last month, Colorado. California's bill, vetoed last year, is slated to be reintroduced this spring. Also, in January, New Hampshire's house passed Michelle's Law, named for Michelle Morse, who died of cancer at 22. Morse remained enrolled at Plymouth State University full-time even while undergoing chemotherapy because if she had changed to part-time or dropped out, she would have lost her free insurance under her mother's plan. The new law extends coverage for up to a year for college students who take an illness- related leave of absence.

A strategy of small steps like these and the one in New Jersey may be better than nothing. "In the absence of doing broader system reform and more universal coverage, this policy at least addresses the most tenuous time in terms of health care—entrance into the labor market," says Sara Collins of the Commonwealth Fund, a nonpartisan health care research organization. Collins recommended just this kind of change in a 2003 report, "Rite of Passage? Why Young Adults Become Uninsured and How New Policies Can Help."

Collins acknowledges that these laws can't help everybody. If the parents don't have benefits to share, their kids are out of luck.

That's the case for Tracy Alwell, 29. A 2004 graduate of Monmouth University in New Jersey, she is currently unemployed, although she most recently worked for E! Entertainment Television—freelance, no benefits. Her father is on Social Security disability. Alwell herself has a rare neurological condition, restless legs syndrome, that keeps her up at night and requires a medication usually prescribed for Parkinson's disease. She cuts her pills into quarters to make them last.

Since reaching adulthood she has been uninsured for all but two years, when she was covered under New Jersey Family Care, a state low-income program. "I had to fight to get it," she says. "It took me 11 months from the time I sent in my application until I got coverage, and I was calling them almost every day following up—I think they gave me coverage so I would stop bothering them—and then I was knocked off because there was too much income in the household." At the time, she was making less than $800 a month and living with her dad. They were scraping along, but by Family Care standards—this year, the monthly cap for a two-person home is $1,100—they were too rich for the rolls.

Alwell recently got a savings card to try to get her needed medicine more cheaply. "I called the pharmacy to get a price on a two-month prescription, which was $150," she says. "I suddenly burst into tears because I could not afford that. I sold something of mine to get some money, called the clinic back and asked if they could call in a prescription for one month instead. . . . I never would have dreamed that someone with a college degree would go through this."

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