Why young Americans dread turning 26: health insurance chaos

Amid the challenges of adulthood, one rite of passage is unique to the United States: the need to find your own health insurance by the time you turn 26.

That is the age at which the Affordable Care Act declares that young adults generally must get off their family's plan and figure out their coverage themselves.

When the ACA was voted into law in 2010, what's known as its dependent coverage expansion was immediately effective, guaranteeing health insurance to millions of young Americans up to age 26 who would otherwise not have had coverage.

But for years, Republicans have whittled away at the infrastructure of the original ACA. Long gone is the requirement to buy insurance. Plans sold in the ACA's online insurance marketplaces have no stringent quality standards. Costs keep rising, and eligibility requirements and subsidies are moving targets.

The erosion of the law has now created an "insurance cliff" for Americans who are turning 26 and don't have a job that provides medical coverage.

Some, scared off by the complexity of picking a policy and by the price tags, tumble over the edge and go without insurance in a health system where the rate for an emergency room visit can be thousands, if not tens of thousands, of dollars.

Today, an estimated 15% of 26-year-olds go uninsured, which, according to a KFF analysis, is the highest rate among Americans of any age.

If they qualify, young adults can sign up for Medicaid, the federal-state program for Americans with low incomes or disabilities, in most but not all states.

Otherwise, many buy cheap subpar insurance that leaves them with insurmountable debt following a medical crisis. Others choose plans with extremely limited networks, losing access to longtime doctors and medicines.

They often find those policies online, in what has become a dizzyingly complicated system of government-regulated insurance marketplaces created by the ACA.

The marketplaces vary in quality from state to state; some are far better than others. But they generally offer few easily identifiable, affordable, and workable choices.

"The good news is that the ACA gave young people more options," said Karen Pollitz, who directed consumer information and insurance oversight at the Department of Health and Human Services during the Obama administration.

"The bad news is the good stuff is hidden in a minefield of really bad options that'll leave you broke if you get sick."

Publicly funded counselors called "navigators" or "assisters" can help insurance seekers choose a plan. But those programs vary by state, and often customers don't realize that the help is available. The Trump administration has cut funding to publicize and operate those navigator programs.

In addition, changes to Medicaid eligibility in the policy bill recently passed by Congress could mean that millions more ACA enrollees lose their insurance, according to the Congressional Budget Office.

Those changes threaten the very viability of the ACA marketplaces, which currently provide insurance to 24 million Americans.

In dozens of interviews, young adults described the unsettling and devastating consequences of having inadequate insurance, or no insurance at all.

Damian Phillips, 26, a reporter at a West Virginia newspaper, considered joining the Navy to get insurance as his 26th birthday approached. Instead, he felt he "didn't make enough to justify having health insurance" and has reluctantly gone without it.

Ethan Evans, a 27-year-old aspiring actor in Chicago who works in retail, fell off his parents' plan and temporarily signed up for Medicaid. But the diminished mental health coverage meant cutting back on visits to his longtime therapist.

Rep. Maxwell Frost, a Florida Democrat and the first Gen Z member of Congress, was able to quit his job and run for office at 25 only because he could stay on his mother's plan until he turned 26, he said.

Now 28, he is insured through his federal job.

"The ACA was groundbreaking legislation, including the idea that every American needs health care," he said. "But there are pitfalls, and one of them is that when young adults turn 26, they fall into this abyss."

Why 26?

Back in 2010, the decision to make 26 the cutoff age for staying on a parent's insurance was "kind of arbitrary," recalled Nancy-Ann DeParle, deputy chief of staff for policy in the Obama White House.

Before that time, children were often kicked off family plans at much younger ages, typically 18.

The Obama administration's idea was that young adults were most likely settling into careers and jobs with insurance by 26. If they still didn't have access to job-based insurance, Medicaid and the ACA marketplaces would offer alternatives, the thinking went.

But over the years, the courts, Congress and the first Trump administration eviscerated provisions of the ACA. By 2022, a shopper on a federal government-run marketplace had more than 100 choices, many of which included expensive trade-offs, presented in a way that made comparisons difficult without spreadsheets.

Jack Galanty, 26, a freelance designer in Los Angeles, tried to plan for his 26th birthday by seeking coverage on the California insurance marketplace that would ensure treatment for his mild cerebral palsy and for HIV prevention.

"You're scrolling for what feels like years, looking at 450 little slides, at the little bars, and trying to remember, 'Was the one I liked No. 12 or 13?'" he recalled. "It feels like it's nearly impossible to make a good choice in this scenario."

Out-of-pocket expenses have soared. Complex plans in the lightly regulated marketplaces featured rising premiums, high deductibles, and requirements that patients pay a significant portion of the cost of care, often 20% — a charge known as co-insurance.

More than half of Americans ages 18 to 29 have incurred medical debt in the past five years, a KFF Health News data investigation found. Few have the reserves to pay it off.

The networks of doctors to choose from in these plans are often so limited that an insured person struggles to get timely appointments. It can even be hard to find the official websites amid an explosion of look-alikes operated by commercial brokers.

Young Invincibles, an advocacy group representing young adults, runs its own "navigator" program to help young people choose health insurance plans.

"We hear the frustration," said Martha Sanchez, the group's former director of health policy and advocacy. "Twenty-six-year-olds have had negative experiences in a process that's become really complex. Many throw up their hands."

Elizabeth Mathis, 29, and Evan Pack, 30, a married couple in Salt Lake City, turned to the marketplaces two years ago, after Pack went uninsured for a "really scary" year after he turned 26.

"Every time he got in the car, I thought, 'What if?'" Mathis said.

The couple pays more than $200 a month for a high-deductible health plan backed by a federal subsidy (the kind set to expire next year). It's a significant expense, but they wanted to be sure they had access to contraception and an antidepressant.

But last year, Pack suffered serious eye problems and underwent an emergency appendectomy. Their plan left them $9,000 in debt, for medical care billed at over $20,000.

"Technically, we gambled in the right direction," Mathis said. "But I don't feel like we've won."

The Affordability Problem

The ACA was supposed to help consumers find affordable, high-quality plans online. The legislation also tried to expand Medicaid programs, which are administered by states, to provide health insurance to low-income Americans.

But the Supreme Court ruled in 2012 that states could not be forced to expand Medicaid. Ten states, led mostly by Republicans, have not done so, leaving up to 1.5 million Americans, who could have qualified for coverage, without insurance.

The ACA requires organizations with 50 or more employees to offer insurance to people working 30 hours per week. This has led to a growing number of contract employees who work up to, but not past, the hourly limit.

Many companies that say they can't afford the rising costs of traditional insurance offer their employees only a modicum of help, perhaps around $200 per month toward buying a marketplace plan, or a bare-bones company plan.

Experts agree that the marketplaces need stronger regulation.

In 2023, the federal government defined clearer standards for what plans in each tier of insurance should offer, such as better prescription drug benefits, defined copays for X-rays, or coverage for emergency room visits.

Certain types of basic care, such as primary care, should require just a small copay for at least a small number of initial visits. Each insurer must offer at least one plan that complies with these new standards for every level, known as an "easy pricing" option or a "standard plan."

Most plans on the marketplaces don't meet these criteria. Federal and state regulators had long planned to cull such "noncompliant" plans, gradually — fearing that doing so too quickly would scare insurers away from participating.

But with the priorities of the new Trump administration now in focus, and a Republican majority in Congress, it's far from clear what course President Donald Trump, who sought to repeal the ACA outright in his first term, will take.

There are hints: Subsidies to help Americans buy insurance, adopted during the Biden administration, are set to expire at the end of 2025 unless the Republican-led Congress extends them.

If the subsidies expire, premiums are likely to rise sharply for plans sold on the marketplaces, leaving insurance out of reach for many more young adults.

KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — an independent source of health policy research, polling, and journalism.

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