Young adults: Obamacare’s dependent coverage provision
Many young adults are taking advantage of the Affordable Care Act’s dependent coverage provision, and as a result they are enjoying better wages. At the same time, they are taking opportunity to pursue higher education that this provision affords them. These were two of the conclusions reached by a study published in the Journal of Health Economics, which analyzed the effects of previous state-based policies under the Affordable Care Act in order to determine whether healthcare coverage options are conducive to improved wages. The answer was that it actually does do that.
The dependent coverage provision states that children up to 26 years old can remain covered by their parents’ insurance plan. Before Obamacare, insurers had the option to removed enrolled children when they turned 19 -or older in some instance, if they were full time students. All children under 26 years of age qualify for dependent coverage, even if they are married, not living with or financially dependent on their parents, attending school or eligible to enroll in an employer-sponsored plan. Resultantly, young adults who might otherwise have to quit school and get a job to afford their own insurance have been able to continue their college/graduate school studies.
Moreover, college grads who are covered by their parents’ insurance have much more flexibility when it comes to choosing a job, seeing as healthcare alternatives for employees -or lack thereof- are immaterial to them. Academic literature supports this; job hunters for whom employer-sponsored health insurance is a nonissue enjoy more freedom of choice, find better employment matches and enjoy better wages on average.
The Journal of Health Economics study established that Americans who were aged 18 or older at the time of the passing of a given insurance law earned at least 2% more at their jobs after turning 22. The boost was associated with an increase in education in men but the same link could not be found in the case of women –though they also enjoyed the same wage raise. The study also predicted that the Affordable Care Act may lead to approximately a 4% increase in wages for young adults who seek dependent coverage, as compared to state-based laws. Check back with Discount Medical Supplies for more healthcare stories very soon.
Related Read: Is The Affordable Care Act the Same As Obamacare?