Health insurance advice for new grads - baltimoresun.com

It may be a new college grad's first real world experience -- and a rude one at that.

Just as soon as the cap and gown are returned to the rental shop, graduates may find themselves bumped from their parents' health insurance.

Many decide not to replace it, figuring they're young, healthy and can wait until they land a job with coverage. The risk is that the job doesn't come up, but an accident or health problem does.

If you decide not to chance it, the first step is to find how much time you really have to buy a policy. Some policies drop you faster than you can text message. Others give months to shop around.

As time runs out, consider your options:


If you're insured under a parent's workplace plan, you may be eligible to continue buying that coverage for up to 36 more months under the federal law COBRA. You will pay the full price plus administrative costs. Not cheap.


A short-term policy. This will cover you for as little as one month to as long as a year. Some policies go for as low as $50 a month, experts say. Applications usually have a half dozen questions, and you can be approved within 24 hours, says Bob Hurley, with eHealthInsurance.com.


An individual policy. Longer term, but not necessarily inexpensive. Some insurers keep prices down by offering limited benefits and high deductibles.

Wellpoint, for instance, targets the "young invincibles" with its new Tonik product line, with policy names of "thrill-seeker," "part-time daredevil" and "calculated risk-taker." Costs range from $69 to $137 per month. It's only available in three states but may be rolled out in 11 other states, including Virginia, next year, where Wellpoint does business, says spokesman Scott Golden. Maryland isn't one of them.


A health savings account. It's a high-deductible policy with a savings feature. Premiums run $50 to $60 per month, Hurley says.

The accounts work like this: You put in tax-free dollars each year to pay the deductible and medical bills. The money builds up in the account and you never pay taxes on it if you use it for health care. To qualify, the deductible must be at least $1,050 for an individual. This year, you can't save more than the cost of the deductible or $2,700, whichever is less.

Parents might want to start new grads off by funding the account to pay the first year's deductible, Hurley suggests.

Some insurers won't touch you if you have a pre-existing condition. States offer programs to cover consumers in this situation. In Maryland, it's called the Maryland Health Insurance Plan.

Find insurers selling policies in your area from the state's insurance commission. In Maryland, visit www.mdinsurance.state.md.us.