If you're young, cash-strapped, and healthy, health insurance might seem expensive and pointless. It's not. An ankle-twisting fall on a hiking trail, a broken arm in a friendly soccer game, bronchitis that turns into pneumonia—you're potentially talking thousands of dollars in medical expenses. Who do you think will get the bill? See which of the following eight categories describes you, and check out experts' recommendations. Our health insurance glossary will help with unfamiliar terms.
You're moving from high school into the workforce.
If your parents are covered through an employer, try to stay on their plan, says Kathleen Stoll, director of health policy at Families USA, a healthcare consumer advocacy group. It'll cost less than getting individual health insurance on your own. If you're under 26 and unmarried, you can be insured as a dependent on your parents' insurance (unless you can get your own job-based coverage). Some states require insurers to extend parental coverage to adult children past age 26; in New Jersey, for example, eligibilty lasts until you're 30. The Department of Health and Human Services (HHS) estimates that about 1.2 million young adults will elect to stay on a parent's health plan in 2011. Downside: Coverage under a parent's plan has its cost. The average policy will cost about $3,380 for each person enrolled in dependent coverage in 2011, according to HHS estimates.
You're headed for college.
Most public and private four-year colleges offer health insurance plans for students who aren't covered through their parents. Yearly premiums could run as much as $2,400, but the average is about $850, about one-fourth the cost of premiums for employer-sponsored group plans. Downside: Part-time students may not be eligible.
You're covered by a parent who has just been laid off.
As long as the company that laid off your parent is still in business, you can retain the same coverage under COBRA, a federal law, for as long as 18 months. Downside: It can be expensive. You are typically responsible for the full premium and a 2 percent administrative fee.
Your parents can carry you on their policy until you're 26. If you're a college grad, your alumni association might offer a plan that'll cover you for up to six months, occasionally longer. New grads may get a discount. Downside: Short-term plans are relatively pricey and coverage may be limited. They should be viewed only as a temporary bridge. If you sign up with no job in sight and get sick, you'll be in trouble if your policy runs out before you're better.
Some health insurers target young adults with plans that cost less than other typical options; a consumer representative at your state insurance department can tell you which plans are available. Remember, the lower the premium, the stingier the coverage is likely to be, and the more you may pay out of pocket. The deductible may be high, and the copayment—how much you have to shell out on the spot for an office visit—as much as $40 or $50. Fit the plan to your situation. You may want the lowest possible copay, for example, even at the cost of a higher monthly premium, if you tend to run low on cash in your wallet or checking account. Downside: Online quotes don't factor in medical history or lifestyle. If you smoke or have a chronic health problem, for instance, you may be rejected or charged far more than the amount shown. And watch out for discount plans disguised as insurance—getting a percentage off the price of a doctor's care is not the same as having health insurance, which covers all or most medical expenses over a fixed amount.
You just got a job.
Most employers pick up a share of the premium, making this the least expensive form of coverage. If you're generally healthy, a high-deductible plan may be less of a drain on your paycheck, but you'd better be able to pay the entire amount of the deductible if necessary. A "health savings account" will make saving up less painful and is tax deductible as well.
This article was originally reported on 4/22/2009. It has been updated.