When Dependents Age Off: Some consistency, some inconsistency 

Since the Affordable Care Act (ACA) reforms took effect in 2014, dependents have been allowed to remain on a parent’s health insurance plan until age 26. Whether that means dependents remain eligible through the end of the month they turn 26 or the end of the year varies depending on who regulates that insurance product. 

There was some variation in early years regarding when exactly aging off of a Marketplace/Exchange Plan happened, but rules have been standardized for some time to clarify that dependents that turn 26 can stay on their parent’s Marketplace plan through the end of the year in which they turn 26. There is nuance if the child is not a tax dependent and the parents receive subsidies to assist with the cost of their premiums, please see here. A few states also allow dependents to stay on past age 26. But in most states, the dependent cut-off age is 26.

How aging off is handled by employers and insurers of group coverage differs. Some allow a dependent to remain covered until the end of the year but many terminate coverage at the end of the month of one’s birthday. Of course, unlike the individual market, those covered under group coverage will have a COBRA option as they age off and will also have a guaranteed right to individual coverage. Involuntary loss of coverage due to aging off is also a qualifying event to enroll in group coverage under one’s own employment if the dependent waived that coverage to remain a dependent on a parent’s plan. 

When a situation occurs that involves involuntary loss of coverage, it’s always important to plan ahead, know the rules, evaluate all options, and avoid a gap in coverage.