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A Springfield Grad Student Opts to Rejoin Her Parent's Insurance Plan

Maggie Petersen weighed her three options before deciding to join the insurance plan her father gets through his Michigan-based job.
Maggie Petersen
Maggie Petersen, a graduate student at MSU, studied abroad in Israel. (Photo credit: Maggie Petersen, used with permission)

24-year-old Maggie Petersen is a busy young woman. She’s a graduate assistant in the political science department at Missouri State University in Springfield.

“I work for two different professors. I do research, grading…and a lot of what I’ve been doing this semester has actually been focusing on the Congo and looking at election results from their last two elections, and minority education within the country,” Petersen said.

She aspires to eventually work for the US State Department. Petersen was on her parents’ health insurance plan all throughout high school and her undergraduate college years.

“And then I graduated and got married six months later. So then I was under my husband’s insurance, and he was in the military.  He separated from the military in January of this year. So my insurance ended in January,” Petersen said.

She’s been without health insurance for the past ten months, because her parents’ health insurance plan only allowed new dependents to come on at the first of the year.

So, Petersen approached the situation like any good graduate student would : she analyzed her options.  She knew that the Affordable Care Act, or Obamacare, was rolling out a health insurance exchange.  That’s essentially a marketplace, made up of private insurance plans, where the coverage is supposed to be more fair and where you can apply for tax credits to offset the cost.

But in addition to the exchange, or marketplace, she knew that the Affordable Care Act also said young people can remain on their parents’ insurance until they turn 26.

“So, it came down to an economic decision for me:  what would be covered under the health care plans in the Affordable Health Care Act, or what would be covered under my parents.  I decided to go under my parents’ insurance. And there are a few reasons for this:  first, the deductible with my parents is 2,000 less…which is huge,” Petersen said.

Again, that’s the deductible – the amount of money you have to pay out of pocket before your insurance kicks in and starts paying the tab. And Petersen says the deductible she found on the health exchanges was $6,000—way too high for her.

“I was looking at that. And then, I was looking at what the co-pay for doctor’s visits would be. And it would be cheaper under my parents’ plan.  I was also looking at a third alternative, which I’ve been taking advantage of in this past ten months—which has been doing a cash negotiation with various doctors’ offices, and asking what they would be willing to take cash payments for.  And I’ve only had to use this once, but it was actually cheaper than what it would have been under either insurance plan,” Petersen said.  

So, Petersen is joining her parents’ insurance plan.  She and her parents agree that Petersen will pay her share of the deductible if she does end up needing to see a doctor.

“The only downside that I have found to being underneath my parents’ insurance is that, since the company is based out of Michigan, and it’s a Michigan-based insurance policy, I can only see doctors in the state of Michigan. Otherwise, I have to pay the full amount—which is why, if I had an emergency situation here, I would take advantage of the cash negotiations with doctors. Because that would just be much cheaper for me,” Petersen said.

This provision—the one allowing dependents to stay on their parents’ insurance plans until age 26—has  been one of the more popular parts of the Affordable Care Act.  According to www.HealthCare.gov, the official Affordable Care Act website, children can join or remain on their parents’ plan even if they are married, not living with their parents, and eligible to enroll in their employer’s health plan.  

The provision only applies to new plans found outside of the marketplaces, and all plans offered inside the marketplaces.

Ryan Barker is vice president for health policy at Missouri Foundation for Health.

"The interesting thing is:  let's say we have a 20-year-old who decides he's not ready for college, or she's not ready for college--gets a job, gets insurance through work, and then after a year or two decides, 'You know, I should have gone to collge.' And they quit working and go back to college--they can actually go back onto their parents' plan," Barker said.

In other words, the law allows a child to go back and forth between plans, just like Maggie Petersen did.

But it also depends where that parent is getting his or her insurance. If it’s through an employer, then most likely, they will be able to keep it—as long as that plan meets the new criteria of the Affordable Care Act.

Join us Monday afternoon at 4:30 as our Sense of Community series on the Affordable Care Act continues on KSMU. We’ll be looking at the unique benefits and challenges it’s bringing to people in rural and remote parts of the Ozarks.  I’m Jennifer Davidson.