N.J. law insures dependent young adults

Nimesh Kabaria is a graduate student in dangerous territory when it comes to health care. Coverage under his parents' plan is set to end later this year, when he turns 23.

“I wouldn't be able to afford a new insurance policy because I'm a full-time student,” Kabaria says. “I'd be stuck without health care.”

But Kabaria gets a reprieve. A new law in New Jersey requires insurers to extend family coverage to older children — up to age 30 — as dependents, so long as they are not married and don't have children of their own.

“In this day and age,” says New Jersey Assemblyman Neil Cohen, “the feeling is, even up to age 30, there's a dependency.”

Cohen considers 20-somethings dependents because so many rely on parents for financial help like loans, down payments and rent.

Young adults age 19 to 29 are among the largest and fastest-growing group of uninsured in the country.

New Jersey lawmakers say they're just recognizing the fact that more young people are staying in school longer, finding entry-level jobs that don't have health benefits, or simply can't afford insurance that costs as much as $6,000 to $7,000 per year.

At least a dozen states have considered or passed similar laws, broadening the definition of dependent. But, unlike New Jersey, many require dependents to be full-time students.

Many New Jersey business leaders support the plan because employers do not have the burden of providing health insurance.

“The No. 1 concern of the employer community is the cost of health insurance,” says Christine Stearns of the New Jersey Business and Industry Association.

Insurers warn that family plans that cover older dependents could be more costly. The legislation allows them to charge more.

“It could be that premiums for particular employers could go up,” says Susan Pisano of America's Health Insurance Plans, “depending on how many people are covered who fit this new definition.”

New Jersey lawmakers expect low costs because most 20-somethings, like Kabaria, tend to be healthy.

“My typical health care expenses right now are for eye exams,” says Kabaria.

He and more than 100,000 young adults in New Jersey soon could have health insurance — courtesy of Mom and Dad.