The Patient Protection and Affordable Care Act (ACA) requires that adults up to age twenty-six be permitted to enroll as dependents on their parents' health plans. This article examines the experiences of states that enacted dependent expansion laws. Drawing on public information from thirty-one enacting states and case studies of four diverse reform states, it derives lessons that are pertinent to the implementation of this ACA provision. Dependent coverage laws vary across the states, but most impose residency, marital status, and other restrictions. The federal Employee Retirement Income Security Act further limits the reach of state laws. Eligibility for expanded coverage under the ACA is much broader. Rules in some states requiring or allowing separate premiums for adult dependents may also discourage enrollment compared with rules in other states (and the ACA), where these costs must be factored into family premiums. Business opposition in some states led to more restrictive regulations, especially for how premiums are charged, which in turn raised greater implementation challenges. Case study states did not report substantial young adult dependent coverage take-up, but early enrollment experience under ACA appears to be more positive. Long-term questions remain about the implications of this policy for risk pooling and the distribution of premium costs.
"Idaho's law applies only to individual and small-group markets. Minnesota's law does not include state health benefit plans (Cantor et al., 2012a). of these polices were to decrease the uninsured rate of young adults. By January of 2010, 30 states had implemented state laws to expand dependent coverage. "
"There was widespread publicity regarding the new law, including an active " Young Adult Coverage " Facebook page created by the White House Office of Public Engagement. There are two published regression-based analyses on the effect of the ACA mandate on health insurance status (Cantor et al., 2012b; Sommers and Kronick, 2012). Both use CPS data through 2010 (reported in 2011), which does not allow one to separate insurance estimates from early versus later in the year. "
[Show abstract][Hide abstract] ABSTRACT: We study the impact of the recent Affordable Care Act (ACA) provision that required private health insurers to allow older child dependents to stay on parental policies until age 26 using data from the Survey of Income Program Participation (SIPP) spanning August 2008 to November 2011. By comparing outcomes for targeted young adults aged 19-25 to those who are slightly older and slightly younger, before and after the law, we find the ACA substantially reduced uninsurance among young adults. Young adults were 30 percent more likely to be on their parents’ employer policies on average after the staggered implementation commenced in September 2010, compared to before the enactment of the law. This increase in dependent coverage drew from both the uninsured and the otherwise insured. We also find evidence consistent with greater take-up among those with higher marginal benefits and lower marginal costs of obtaining dependent coverage, such as those whose parents already had family employer health insurance policies prior to the law. Dependent coverage increases are also greater for Whites relative to non-Whites, for single individuals relative to married individuals, and for non-students relative to students. We find no statistically significant difference in the impact of the provision on young adults who reside in states with and without some form of prior state dependent coverage mandate.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
American Economic Journal Economic Policy 11/2013; 5(4):1-28. DOI:10.1257/pol.5.4.1
"Nevertheless, the state laws may have raised awareness of the possibility of dependent coverage even among young adults ineligible under restrictive state laws. This possibility is corroborated by reports of state regulators hearing frequently from frustrated consumers who were ineligible for state expansions due to employer self-insurance or other eligibility limitations prior to the ACA (Cantor et al. 2012). If the " priming " hypothesis is correct, take-up among ACA-targeted young adults who were not eligible under prior state laws will likely grow substantially over time. "
[Show abstract][Hide abstract] ABSTRACT: This paper evaluates one of the first implemented provisions of the Patient Protection and Affordable Care Act (ACA) which permits young adults up to age 26 to enroll as dependents on a parent’s private health plan. The paper also considers how the interaction between prior state laws expanding dependent coverage to young adults and the ACA affected young adult coverage. Using data from the Current Population Survey for calendar years 2004-2010, we apply a difference-in-differences framework to estimate how these provisions affected coverage of eligible young adults compared to slightly older adults. Our findings indicate that controlling for state laws, early implementation of the ACA increased young adult dependent coverage by 5.3 percentage points and resulted in a 3.5 percentage point decline in their uninsured rate. The interaction between state laws and the ACA suggests that the increase in dependent coverage and decline in the uninsured rate may have been greater among young adults who were targeted by both the ACA and state laws.
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