May 29, 2009

State Insurance Department: college graduates need health coverage

Jefferson City, Mo. - As college graduates across Missouri walk off the stage and into the working world, they need to remember their college career may not be the only thing ending - their health insurance coverage may be as well. The Missouri Department of Insurance is reminding graduates and their parents to explore their health insurance options, especially if they don't yet have a job that offers them coverage.

"Avoiding the cost of health insurance may be a tempting prospect for young adults looking to save money," said John M. Huff, director of the Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP). "But the consequences can be devastating for health and finances should a medical catastrophe occur."

 Huff reminds young adults that massive medical bills can result from car accidents, emergency surgeries and a number of other circumstances that may seem unlikely to the average healthy 22-year-old. In addition, health insurers encourage preventive care to detect health problems early, thus avoiding more expensive treatments later. The department offers these tips:

Review Your Health Insurance Needs

  • Determine the exact date your health coverage expires under your parents' policy. Some health insurers terminate coverage upon graduation, while others set a particular age limit.
  • Choose the kind of policy that has benefits that most closely fit your needs. Does your family have a troubled health history that puts you at risk for developing a medical condition? If so, you may want to choose a health plan that has more extensive coverage, even if it means paying higher premiums.

Know Your Options

 Employer plans: If you are working, your employer may offer health insurance. Talk with your organization's officer responsible for human resources to determine what plans are right for you. 

  • Parents' plans: If one or both parents claims you as a dependent, you may be able to stay on their plan.  
  • Buy a major medical policy: If you can't afford comprehensive health insurance, a more affordable option is purchasing a high-deductible, major medical policy that only covers serious or catastrophic health costs. It will offer lower premiums than regular health insurance policies and help you cover bills for "major" medical events, such as surgery, hospitalization or emergency room care, but typically will not cover routine doctor visits or check-ups.  
  • COBRA : If you need coverage only for a short time until a new policy kicks in, your parents' policy may allow you to "COBRA." That means you pay to stay on their plan for a certain number of months. COBRA requires you to pay the full premium, which is expensive. 
  • Short-term health insurance: Another option for those only needing coverage for a short time. These policies are available for lower premiums than other types of health insurance and are sometimes purchased on a month-to-month basis. They have more limited benefits, so they are usually not suitable for those with pre-existing conditions. 
  • College plans: Your college or university may offer an option to extend your coverage under the health plan they offer to students. 
  • Medical discount plans: This is not insurance. Instead it's a plan that may  save you money on medical treatment or prescription drugs. Before considering one of these plans, check with the Department of Insurance to see if the company is registered as required by state law. Also, confirm with your health care providers and pharmacy that they participate in the savings promoted by the discount plan.

Consumers with questions can call the Department of Insurance Consumer Hotline at 1-800-726-7390 or insurance.mo.gov.

About the Missouri Department of Insurance, Financial Institutions & Professional Registration

The Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP) is responsible for consumer protection through the regulation of financial industries and professionals. The department's seven divisions work to enforce state regulations both efficiently and effectively while encouraging a competitive environment for industries and professions to ensure consumers have access to quality products.

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