Continuing Parent-Provided Health Insurance Coverage for Young Adults in the Age of Obamacare
2010’s Patient Protection and Affordable Care Act, commonly called Obamacare, afford young adults who are covered as dependent insureds on their parents’ health insurance plan the ability to continue coverage until the age of 26, even if they are employed and have access to employer-provided benefits. Although the issue is usually not directly related to the property settlement dynamic in a divorce case, it is frequently at issue in Las Vegas divorce negotiations where the parties are often attempting to meet total family expense needs with a static or reduced pool of money. In other words, divorcing parties are directly invested in assuring that they and even their adult children retain health insurance coverage by the most affordable means possible. This issue is frequently negotiated in Clark County Family Court cases and is related to Nevada child support obligations and Nevada alimony payments.
There may be a wide array of benefits to maintaining health insurance benefits for a young adult on a parent-provided plan. Such a plan, for example, may have more attractive coverage or out-of-network reimbursement rates than a given individual or employer-provided plan, or it may have lower premium rates for coverage. Further, inasmuch as employer-provided health insurance premiums are generally withheld as pre-tax deductions from salary, a parent may receive an effective tax benefit by allocating more income to insure a young adult, thereby reducing taxable gross income. In any event, prospective tax benefits are complex and should always be fully explored with a tax professional in addition to your Nevada family law attorney.
While every insurance situation needs to be assessed on its own merits, the enactment of this provision of the Affordable Care Act has substantially broadened the health insurance options and choices available to young adults – a segment of society that has been particularly impacted by the economic downturn and the reduced incomes and employment opportunities that have resulted.