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Fact Checked
Health insurance can play a vital role in your health and financial stability regardless of age. Young adults may not seek as much health care as someone in their 50s and 60s, but health insurance can still be important to people in their 20s.
Young adults can stay on their parents’ health insurance until they reach age 26. Whether it makes sense to remain on your parents’ plan or get your own plan depends on your health insurance options and costs.
Finding the best health insurance for young adults requires comparing health insurance premiums and costs, including health insurance deductibles and coinsurance, and other factors like provider networks.
Here are the top health insurance companies for young adults.
| Company | Overall Forbes Advisor rating | Average monthly cost for single coverage for 21-year-old | Average monthly cost for single coverage for 27-year-old | VIEW MORE | ||||
|---|---|---|---|---|---|---|---|---|
| Kaiser Permanente |  |
5.0 |  |
$335 | $351 | View More | ||
| Blue Cross Blue Shield |  |
4.5 |  |
$419 | $431 | View More | ||
| UnitedHealthcare |  |
4.0 |  |
$355 | $372 | View more | ||
| Cigna |  |
3.5 |  |
$385 | $412 | Learn More | On Healthcare Marketplace's Website | |
| Aetna |  |
3.5 |  |
$371 | $389 | Learn More | On Healthcare Marketplace's Website |
Source: Healthcare.gov. Based on unsubsidized ACA plans.
One of the cheapest ways for young adults to get health insurance is to stay on a parent’s health insurance plan. The Affordable Care Act allows parents to keep children on their coverage until 26 and a few states allow parents to keep them on their plan even longer. Still, there are other options, too.
Here are some of the ways young adults can find the cheapest health insurance.
Remaining on your parent’s health insurance may make the most sense if it’s an affordable option. You don’t have to be single and live at home to stay on your parents’ plan. You can live elsewhere, be married and even have a child and remain on your parents’ health plan.
Here’s why you may want to stay on your parent’s health insurance:
An employer-sponsored health plan may work best for you if your employer offers a group health insurance plan with no premiums or low premiums.
Here’s why you may want to go on an employer’s health plan:
A Medicaid plan can offer you a no-cost or low-cost health insurance plan if you qualify. The low-income federal/state health plan bases coverage and costs on your income.
Here’s why a Medicaid plan may be a good choice for you:
Buying a health insurance plan from your state or federal marketplace is another way you can find affordable coverage as a young adult. You can find the cheapest health insurance plan with the benefits you want by comparing prices—you may even qualify for subsidized rates based on your income.
Younger people typically pay less for health insurance through the ACA marketplace. Group health insurance doesn’t use age as a factor when setting rates, but insurers in the ACA marketplace use age as one of the metrics.
| Who’s covered | Bronze plan | Silver plan | Gold plan |
|---|---|---|---|
|
21-year-old, individual coverage
|
$313
|
$410
|
$450
|
|
21-year-old, individual with one child
|
$549
|
$720
|
$791
|
|
21-year-old, couple coverage
|
$625
|
$819
|
$900
|
|
21-year-old, couple coverage with one child
|
$862
|
$1,130
|
$1,241
|
|
27-year-old , individual coverage
|
$330
|
$433
|
$476
|
People under age 30 have the option to get a catastrophic health insurance plan. Catastrophic health insurance offers similar benefits found in an ACA health insurance plan but at lower premiums and much higher deductibles than standard ACA plans.
For instance, health insurance companies can have up to $8,700 deductibles per person or $17,400 for a family in a catastrophic health insurance plan. That’s significantly higher than deductibles found in ACA plans. In comparison, a high-deductible health plan is any health plan with a single annual deductible of $1,500 and family deductible of $3,000.
The way deductibles work differs in a catastrophic plan compared to a standard health plan. With a catastrophic health plan, the health insurance company picks up the rest of the out-of-pocket costs for the year after you reach your deductible.
That’s unlike standard health insurance, which typically has a coinsurance portion when the member and health plan split costs after reaching the annual deductible. Members pay coinsurance until reaching the annual out-of-pocket maximum, which is when the health plan begins picking up all health care costs for the year.
Here are the average monthly costs for a catastrophic health insurance plan compared to ACA plans.
| Type of plans | Average monthly cost for single coverage for 21-year-old | Average monthly cost for single coverage for 27-year-old |
|---|---|---|
|
Catastrophic health insurance
|
$235
|
$247
|
|
ACA Bronze plan
|
$313
|
$330
|
|
ACA Silver plan
|
$410
|
$433
|
|
ACA Gold plan
|
$450
|
$476
|
Short-term health insurance plans are an option in most states. These low-cost plans offer limited benefits and high out-of-pocket costs when you need care.
Short-term plans are meant to fill gaps in coverage temporarily. For instance, a short-term plan is a cheaper alternative to COBRA insurance, which extends employer-sponsored health insurance after someone gets laid off.
Most people can buy a short-term health plan for a year with the option to extend coverage for another two years. Not all states allow these plans and some restrict the length of coverage.
If you’re interested in a short-term plan, make sure to dig into the coverage information. Short-term health plans often don’t cover mental health, prescription drug and maternity care, so you’ll be on the hook to pay for all of those costs.
Shopping for health insurance requires comparing health insurance premiums and out-of-pocket costs, provider networks and types of plans.
Your first step is to see the ways you can get health insurance. Maybe you can stay on your parents’ plan but also have access to coverage through an employer. Or perhaps you can get an Affordable Care Act (ACA) plan.
Once you figure out your insurance plan eligibility, you can move to the next step of deciding on a health plan’s benefit design.
Health insurance plans have different names associated with benefit designs, including preferred provider organization (PPO), health maintenance organization (HMO), exclusive provider organization (EPO) and point of service (POS ) plans.
A plan’s benefit design can vary by whether you can get out-of-network care and if you need referrals to see specialists. The more flexibility and fewer restrictions you have in your plan, the more you pay for health insurance. That means PPOs usually cost the most and HMOs and EPOs are the cheapest plans.
Decide how much freedom you want in your plan, and then it’s time to compare costs.
Health insurance premiums are what you pay to have health coverage. These are a key piece of health insurance costs, but don’t forget about out-of-pocket costs like deductibles and coinsurance. These out-of-pocket costs come into play when you need health care.
See how much you would pay in premiums and compare those costs with out-of-pocket costs. For instance, if you’re comparing plans and one has a low premium with a high deductible, but the other has a higher premium and lower deductible, you need to figure out if you would rather pay more for coverage and less when you need health care or vice versa.
If you’re buying a health plan on the ACA marketplace, Bronze and Silver plans have the cheapest premiums but higher deductibles and out-of-pocket costs than Gold and Platinum plans. Gold and Platinum plans have higher premiums with lower deductibles. A Bronze or Silver plan could be a wise choice if you’re a young adult in good health and don’t expect to need much health care over the next year.
Health insurance companies contract with health care providers to create networks. These provider networks ultimately influence where you can get care and how much you pay.
If you have an HMO or EPO, you will likely have to stay within the provider network to get help from the health insurance plan. A PPO and POS generally allow you to get out-of-network care, but that comes at a higher cost.
Make sure the plan has a wide provider network in your area and your provider is on that network. You may otherwise have to pay all or most of the costs for out-of-network care.
Once you complete each step, you can choose between plans to find the right health insurance plan for you.
Forbes Advisor identified the best health insurance companies and then selected the companies that are best for young adults, based on health insurance plans’ average monthly Affordable Care Act marketplace plan costs for 21-year-olds and 27-year-olds.
Forbes Advisor’s ratings are based on:
Read more: How Forbes Advisor rates health insurance companies
No, most Americans aren’t required to have health insurance. The Affordable Care Act (ACA) mandated health insurance for most Americans, but Congress removed the tax penalty in 2019, effectively eliminating the health insurance mandate. A handful of states have their own individual mandate, including California and New York.
The Affordable Care Act (ACA) open enrollment is from Nov. 1 to Jan. 15 in most states. States with their own state exchange, including California and New York, may have different open enrollment periods, though they’re roughly around the same time of year. Employers, which is how most people get health insurance pre-retirement age, decide on their open enrollment period, so you need to ask your company for the specific period.
Whether to stay on your parents’ health insurance or go on a company’s group health insurance plan depends on the costs, provider network and benefits. If the employer-sponsored plan is cheap (or free), you may want to go with that health coverage. Just be sure to review the plan’s out-of-pocket costs like deductibles, coinsurance and out-of-pocket maximums. You may find a low- or no-premium health insurance plan has exorbitant out-of-pocket costs when you need care.
A high-deductible health plan (HDHP) like a Bronze or Silver plan in the ACA marketplace is one way to reduce your health insurance premiums. But having an HDHP plan means you pay more when you need care. Compare how much you would save by having a lower health insurance premium and whether potential higher out-of-pocket costs are worth it.
No, younger people generally pay less for health insurance on the ACA marketplace. For instance, our analysis found that the average 21-year-old pays $313 monthly and a 27-year-old pays $330 for a Bronze plan. That’s much lower than the overall average cost for individual coverage for a Bronze plan ($928 a month). If you enroll in an employer’s group health insurance plan, those plans don’t base costs based on age.
