Baby On Board ... With Insurance!

04/19/2014

A federal rule requires insurance providers to cover children signed up within 30 days of birth retroactively to day one. Some plans may provide more flexibility.

Expecting a baby? At most, you have nine months to do your homework. Don't forget to review the chapter on insurance!

The Wall Street Journal urges couples to take care of this task in the recent article, "Newborns Need Health Insurance Too."

If spouses have separate insurance providers, the WSJ advises expecting parents to calculate what premiums, deductibles and co-pays would be for the family plan under each carrier. And don't wait until the baby arrives.

Make sure you also talk to your insurance provider, as soon as you decide which plan you are picking. Typically you can make this addition outside of the open enrollment window as it is a life event [the birth of your child]. If you fail to do so, then this may trigger an uninsured child penalty under the Affordable Care Act of $47.50 or 1% of your income, whichever is higher, this year.

"Health insurance for your kid is nonnegotiable," the article says, quoting a young mom who has a 15-month-old son. She had her son enrolled in an insurance plan by the time he was 10 days old.

A new baby also means changes to your estate plan: adding a beneficiary, modifying your will, and perhaps even starting a trust. Speak to your estate planning attorney to analyze all of the factors in your situation.

And congratulations!

For more information, please visit my estate planning website.