Insurance reforms and adult child coverage to age 26 DO NOT extend to retiree only health benefit plans

If you are thinking of retiring early and have an adult child covered under your health benefits who you plan to cover to age 26, think twice about retiring.

 Regulations issued by the Department of HHS make it clear that the insurance reforms that are part of PPACA, including the requirement to allow enrollment of adult children to age 26, DO NOT apply to retiree only plans.  These plans do not have any active employees enrolled, but only retired employees of a company and are typical of large employers.  The adult child requirement also does not apply to Medicare.

While relatively few people are affected, individuals with adult children planning on retiring early will have to look to COBRA and pay the full cost.

This conclusion by HHS is somewhat strange given the Administration’s push to expand coverage and the pressure it has placed on insurers and employers to accelerate the effective date for adult children coverage.  There are many aspects of PPACA left to regulations and interpretation by the Secretary of HHS.

Categories: Healthcare

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