There is a popular section of the ‘federal health care legislation’ which permits young adults under the age of 26, to take advantage of insurance coverage of the parents. This has led to some innovative costing by employers who are trying to find novel strategies to make the employees do extra for children on those benefit plans.
There are many more employers who are adopting “unitized” or “per participant” pricing system so that the employee’s contribution to payroll increases with every dependent added to the coverage by the worker. This approach is different from the usual family or single coverage, which is also called the partner benefits. This allows the worker to add a domestic partner or spouse to the insurance plan.
This provision in the health law allows parents to cover dependents till the 26th year and has been in effect from September 2010 end. Earlier the parents had to drop children from family insurance policies by the ages of 18 or 21 or when once they graduated from college. It was possible for the employers to resent such pricing before the introduction of the law, but it is seen to be escalating as the health law makes it obligatory for insurers to offer insurance coverage to adults till 26 years.
Based on the subsidiary offered by the employer in the employee’s coverage, they can include few more dollars in cost for every child added to each biweekly pay period. The cost of the employee varies a lot from one employer to the other. According to benefits analysts, the employers typically cap the “per participant” rate to the utmost number of kids. What this means that people with eight children will not have to give eight times more.
As pegged by the benefits analysts, the effect of including young adults to the parents’ health insurance plan at an added 1 to 3 % to the premium costs, is small when compared to the fact that college going kids are generally healthy and don’t require to use the health insurance. On the other hand employers feel that companies may have a better reason to commence a new a pricing system as according to various surveys, many young adults are unemployed due to the recession. This had led to an increase in the number of old workers.
According to the employer groups this strategy also lets them spread the costs fairly among the employees. This is in accordance with the approach used by many employers, where they make people who use the system more often to pay more.
