Young adults turning 26 are focused on career upswings, family, and making big life moves. But, for some, it’s also when they lose access to their parents’ health insurance. Unfortunately, this “insurance cliff” can mean facing complicated, expensive, and confusing coverage choices. What happens: an increase of young people underinsured, in medical debt, or without coverage at all.
But this isn’t the fault of incorrect coverage choices. This is a workforce problem. Young employees entering the job market and working in part-time, gig, or contract roles often have the least access to affordable, reliable benefits. With costs rising and plan designs getting more complex, the safety net for those after 26 falls short. The population falling into the underinsured bucket is growing. Today, an estimated 15% of 26-year-olds go uninsured, which, according to an analysis by the health research group KFF, is the highest rate among Americans of any age.
Here’s where employers can make a difference. Stronger benefit programs, clearer communication, and intentional plan design can prevent young workers from falling through the cracks. Employers who invest in better health benefits (and retirement savings for that matter) have the opportunity to help their teams while also building loyalty, improving retention, and attracting the next generation of talent that expects more from their workplace.
There is certainly more to the whole picture, but as fiduciaries, we have a unique role in guiding employers through these decisions. Aligning benefits with real employee needs creates lasting value, both for the business and for the people who drive it. The “insurance cliff” isn’t just a policy issue. It’s a shared challenge. And solving it can start with employers taking action to provide meaningful, accessible coverage.
