Many private and employer-sponsored health insurance plans offer coverage for dependents. This allows you to purchase benefits for your children, spouse, and other eligible individuals. While there is an additional cost to cover additional people, you may find that the benefits are well worth it.
Adding dependents to health insurance plans provides financial protection in case they have a serious illness or accident that requires expensive medical treatment. Even if you and your dependents are relatively healthy, it’s important to remember that life is unpredictable, and unexpected medical emergencies happen every day. An emergency room visit can cost more than $1,500, and that does not include the cost of any necessary follow-up treatments. In addition to emergencies, health insurance can also cover the cost of routine care, chronic illnesses, and more.
If you are adding dependents to your health insurance plan, ensure you have the information you need to make sound decisions about your family’s healthcare coverage.
Is Health Insurance Mandatory for Dependents?
Health insurance is no longer federally mandatory for yourself and your dependents, though some states have their own health coverage requirements for residents. The original Affordable Care Act (ACA), also referred to as Obamacare, initially required every American to have health insurance or pay a tax penalty, and the states that mandate coverage still impose penalties for not having health insurance.
The following 5 states and districts require health insurance for yourself and your dependents:
- California
- Massachusetts
- New Jersey
- Rhode Island
- Washington, D.C.
The ACA also offers protection for dependents, requiring insurers that offer dependent child coverage to make it available until December 31 of the year the adult child turns 26 years old.
Who Counts as a Dependent for Health Insurance?
Generally, your spouse and children can count as a dependent on your health insurance plan. However, before adding a dependent to your health insurance, it’s important to make sure they’re eligible for coverage under your plan. Generally, if someone can be counted as a dependent on your taxes, they’re also considered a dependent for health insurance purposes.
Your children can typically stay on your health plan until they turn 26 years old. To be eligible, they must be your biological child, stepchild, adopted child, or a foster child in your care. If your child has other siblings, half-siblings, or children of their own, these children can also be included as dependents on your plan.
The child must also have lived with you for a minimum of 6 months to be eligible. Their taxable income must also be less than half the cost of their support expenses, and they cannot have filed a joint tax return with anyone else. A child can also only be claimed as a dependent by one household at a time.
You may add your spouse to your health insurance plan within 30 to 60 days after getting married. During this timeframe, you can usually add your spouse as a dependent or enroll in a new plan. If you choose not to add your spouse during this time, you generally have to wait until the next open enrollment period to make a change.
You may be able to add other family members as dependents if all of the following are true:
- You are responsible for providing more than half of their financial support.
- Their gross annual income is less than $4,300.
- No one else has named them as a dependent.
You may be able to include a non-relative who has lived with you for a minimum of one year if all of the above criteria are also met.
Who Cannot Be Added as a Dependent for Health Insurance?
Generally, adding parents to health insurance plans is not allowed. However, plans may vary, so you may want to check your specific plan to confirm. If you can claim them as your tax dependents, your plan may offer them coverage.
If your parents need health coverage and your plan does not allow you to add them, they may be able to obtain it through their job, by purchasing an individual health insurance plan, or through Medicare once they are eligible.
Non-relatives, such as friends, godchildren, and others typically may not be added as dependents. However, if they meet the requirements listed in the previous section, they may be eligible. Your insurer can confirm eligibility.
Why Add Dependents to Your Health Insurance?
Making sure your dependents are covered helps to protect them financially and can also help ensure they’re able to get the medical care they need.
Younger children typically use insurance benefits to cover the cost of routine pediatric visits and required vaccinations, as well as common issues like ear infections, sore throats, and injuries. Teens and young adults may incur medical expenses for things like cavities, acne, menstrual disorders, mental health issues, or sports-related injuries.
If your elderly parents qualify as dependents, your health insurance coverage can help offset expenses for health conditions like osteoporosis, diabetes, Alzheimer’s disease, respiratory diseases, heart disease, and cancer. It can also cover injuries from falls and other types of accidents.
Healthcare costs can add up quickly, and without health insurance, an unexpected medical issue could cause major financial problems. For example, the average cost of a 3-day hospital stay is approximately $30,000, and fixing a broken leg can cost you about $7,500.
While regular preventative care and timely treatment of conditions can help reduce some medical expenses, having sufficient health insurance coverage can greatly lower your out-of-pocket costs for medical expenses. Ultimately, health insurance coverage makes quality healthcare more affordable and accessible.
How to Add a Dependent to Your Health Insurance
Health insurance plans typically have an annual open enrollment period. This is November 1 through January 15 for most states, though some states may have a different timeframe. Employer-sponsored plans may have their own annual enrollment window too for changes. During this time, individuals and families can make changes to their plans, such as choosing a different plan, adding or removing benefits, and adding or removing covered individuals.
However, there are some “life-changing events” which are recognized as legitimate reasons to make changes to a health insurance plan outside of the open enrollment period. Some of the qualifying circumstances include:
- Marriage or divorce
- Birth or adoption of a child
- Beginning or ending of your spouse’s employment
- Change in hours that affects you or your spouse’s eligibility
- Beginning or ending of unpaid leave of absence for you or your spouse
There is generally a limited amount of time after the event occurs to make the change to your health insurance policy. Otherwise, you may need to wait until the next open enrollment period. Contacting your insurer quickly after a life-changing event may help ensure you’re able to get your dependents the coverage they need in a timely manner.