Insurance Transitions over the Family Life Cycle

The Committee noted in its first report, Coverage Matters, that U.S. insurance arrangements function like a sieve, with many holes through which individuals and whole families may slip. This chapter focuses on the transitions in a family’s life cycle where this slippage is most likely to occur (see Box 3.2).

Many of these transitions and their insurance consequences could affect anyone and some are essentially unavoidable. These transition points, which sometimes threaten continuous insurance coverage, represent targets of opportunity for policy action. Some of the transitions indicate where families bump up against the rules of coverage set by private insurers and public programs.

In this chapter, three kinds of transitions are particularly relevant:

  1. Age: As individuals within families age, their health insurance status may change because of rules in public programs and private plans.

  2. Employment status: How and where family members are employed may affect the family’s insurance status.

  3. Marital status: Family issues relating to marriage, divorce, widowhood, single parenting, cohabiting, and separating may affect coverage.

There is considerable overlap among these three types of changes in status when one considers how each may influence coverage. For example, a child may reach age 19, get a job, and get married all around the same time. Decisions for each change may be interrelated and each can have insurance implications. In the following pages, each kind of transition is described and their interactions are discussed.

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