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ILLINOIS, FEDERAL HEALTH LAWS DIFFER

Updated: May 3, 2013 12:14PM



Q. You recently wrote about the Health Care Reform Act that will require employers to cover children up to age 26. But don't we already have that law in Illinois?

A. Thanks to you and many readers who pointed out that Illinois did pass Young Adult Dependent Coverage as part of a bill that went into effect on June 1, 2009. That state law requires all individual and group health insurance, and HMO contracts that offer coverage to dependent children to extend that coverage for qualifying dependents up to age 26 (and up to age 30 for military veteran dependents).

In effect, the provisions of this Illinois law are similar to the federal Health Reform Act (the Patient Protection and Affordable Care Act of 2010), which guarantees continuation of health insurance coverage for dependents up through age 26, on their parents' policies.

OK -- that sounds simple, but the devil is in the details, both with the Illinois plan and with the new federal law.

Illinois' coverage sounds comprehensive -- but there are some significant exclusions.

First, the Illinois law does not require companies to offer dependent coverage.

Also, the Illinois dependent coverage requirement does not apply to companies or unions that self-insure. A surprisingly large number do self-insure -- in effect, becoming their own insurance underwriter. They likely carry ''excess'' coverage in case of a catastrophic medical claim. But because they are self-insured, the Illinois law does not apply to these organizations.

Another drawback to the Illinois plan (as compared with the federal plan which will soon go into effect) is the possibility that dependents can be subject to pre-existing condition limitations contained in a group policy.

The new federal law also has some drawbacks, in that it won't solve your dependent's insurance needs immediately. In fact, the portion of the federal law that requires dependent coverage through the end of the year they reach age 26 doesn't go into effect until the first plan year starting ''on or after'' Sept. 23, 2010. Since most plan years start in January, today's college grads will find themselves in a gap period before their parents' plan is required to offer coverage. And rules have not yet been written about whether these grads must be reinstated if their coverage has lapsed in the interim.

That's why I have recommended that this year's college grads purchase a short-term health insurance policy with a high deductible to cover catastrophic costs. You can search for such a policy offered in your state at www.eHealthInsurance.com.

Q. I have been paying for my COBRA insurance, which is only affordable because the government subsidizes 65 percent of the costs. But now I hear that subsidy will run out because I have been using it for the past 15 months. Will they extend this subsidy? I really can't afford this health insurance if I must pay the entire premium.

A. The extension of the COBRA subsidy on health insurance for people who have lost their jobs was for a maximum of 15 months. This subsidy was set to expire -- and did -- on May 31. That means your next bill for health insurance will include the complete cost of the program -- unless Congress acts quickly and makes its decision retroactive.

The subsidy was actually set to expire last April, but a last-minute, bipartisan vote extended the program until the end of May. But when Congress went on recess May 31 -- the Friday before the Memorial Day holiday weekend -- a COBRA extension, originally part of The American Jobs and Closing Tax Loopholes Act of 2010, became one issue of unfinished business.

Both the House and Senate return to Washington next week, where the issue is likely to come up again. Any extension could be made retroactive to May 31, when the last provision expired. If you are interested in this provision, now it the time to contact your representatives in Washington.



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