Child-only policies are health insurance policies that insure children and only children. Most child-only policies exist as part of larger health systems or plans in the public and private sectors, providing a range of options for parents looking for child-only policies.

Most people in the U.S. — adults and children — access health insurance through employer-based plans. But in many instances, children — defined here as individuals under age 19 — lack any type of health insurance. (The federal government usually defines children as 0-17, though most state-run programs define children as 0-18 or 0-19.)

Children may reside in a household where no one is covered or where their parent or guardian cannot afford policies that cover their dependents. In other cases, an employee health plan may cover just the employee or the employee and the employee’s spouse, leaving the children uninsured.

As a result, parents are forced to look for child-only policies. Although there are many options for child-only insurance in both the private and public sectors, these options are often determined by the financial situation of the parents.

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Types of child-only insurance

When looking for child-only health insurance there are many different types of plans in the marketplace to choose from. These will all depend on your specific needs and financial situation. Below we have outlined the specific differences based on cost, eligibility, coverage and enrollment:

Medicaid

Medicaid covers low-income and indigent populations, providing comprehensive care to poor adults and children. Beneficiaries have to meet certain income and eligibility requirements, which vary from state to state.

Pros: Medicaid provides comprehensive insurance that generally does not charge copays or deductibles for covering children, making it a highly desirable form of coverage. Unlike with ACA plans, eligible beneficiaries can enroll in the program any time during the year without having to wait for an open enrollment period. Only four Medicaid programs — California, Maryland, Michigan and Vermont — charge premiums or enrollment fees for children.

Cons: Medicaid is an insurance program for very low-income and indigent populations, and not everyone qualifies for the program. Some doctors may be reluctant to take Medicaid patients because of low reimbursement rates. Medicaid coverage can take up to 45 days to take effect in some states after an application is approved.

Children’s Health Insurance Program (CHIP)

CHIP is a program that provides comprehensive health care coverage to children only, under the age of 19 in most states. CHIP recipients are not poor enough for Medicaid but cannot afford private insurance. As with Medicaid, eligibility requirements vary from state to state. In some states such as Massachusetts, CHIP is embedded in the state Medicaid program, and the Medicaid program administers the CHIP benefits, functioning as a children’s Medicaid program.

Pros: CHIP provides comprehensive coverage at higher rates than Medicaid, but CHIP rates are cheap nonetheless, making coverage affordable. As with Medicaid, eligible CHIP beneficiaries can enroll in the program during the entire year without having to wait for an open enrollment period. In addition, routine well-child doctor and dental visits are free under CHIP.

Cons: CHIP income limits are higher than Medicaid income limits, but they are still low, making many children ineligible because their household incomes are too high. Additionally, coverage is not as extensive as it is with Medicaid, and coverage can take up to 90 days to take effect in some states after an application is approved. Twenty-one state programs charge a deductible or copay, or both. More than half — 26 programs — charge premiums or an annual enrollment fee.

Please note that some states such as Massachusetts and California have different names for CHIP and Medicaid, while other states such as Texas and Delaware do not.

State programs that charge premiums or enrollment fees:

State programs that charge copays, deductibles or both

Affordable Care Act (ACA)

The ACA enables individuals and families to access health insurance through health insurance marketplaces, which are federally regulated and subsidized. To qualify, people are required to sign up for a plan during an open enrollment period, which usually occurs in the fall, or during a special enrollment period. Beneficiaries can also qualify for a plan by having a qualifying life event, which includes the birth or adoption of a child, marriage or divorce, the loss of employer-based coverage or moving to a new coverage area.

Pros: Many people seeking ACA plans qualify for subsidies to help defray the cost of premiums, deductibles and copays. ACA plans cannot reject people based on preexisting conditions, and all plans are required to cover the 10 essential health benefits.

Cons: To qualify, beneficiaries are required to sign up for the plans during an open enrollment period, which usually begins in the fall. Exemptions are made for people with qualifying life events. Even with subsidies, the costs of ACA plans are higher than the costs of CHIP and Medicaid plans.

Private plans

Private plans are health insurance policies purchased outside of the ACA marketplaces that provide comprehensive coverage.

Pros: Private plans can be bought immediately from an insurance company without having to go through the ACA marketplace. Unlike with ACA plans, beneficiaries don’t have to wait for open enrollment periods to apply. Private plans also have to adhere to the same protections that apply to ACA plans. Coverage can start immediately.

Cons: Private plans are more expensive than CHIP and Medicaid plans as well as ACA marketplace plans. Unlike with an ACA plan, a parent cannot access subsidies to help pay for coverage with a private plan.

Short-term plans

Short-term health insurance plans are typically bought directly from a health insurer that provides coverage for a year or less, bridging gaps in coverage.

Pros: Short-term plans are good for bridging gaps in coverage while providing cost protection against catastrophic events such as a broken leg. These plans also tend to be less expensive in premiums than others because they provide short-term coverage, anywhere from three months to one year. Coverage can start immediately.

Cons: Short-term plans do not have to adhere to protections provided under the ACA, making it possible for the insurers to deny coverage based on preexisting conditions or to cap dollar amounts. Similarly, short-term plans do not need to cover the 10 essential health benefits, which means there could be gaps in coverage.

What is the best child-only health insurance coverage?

ValuePenguin has rated the options based on three criteria: cost, extent of coverage and eligibility criteria. Cost considerations are the No. 1 factor blocking access to care, playing a predominant role in determining what options parents should pursue first. Coverage and eligibility requirements are also important considerations.

First choice: Medicaid

Medicaid is the largest source of child-only health insurance in the country, providing care to more than 40 million children. For any parent looking for a child-only health insurance policy, Medicaid should be the first option to consider.

The program, funded through a combination of state and federal funds, covers all types of medical care — regular medical services, preventive services, prescription drugs, dental and vision care as well as long-term care. In addition to providing full benefits, Medicaid is also the cheapest form of health insurance available.

Medicaid programs do not charge deductibles, and most state Medicaid programs charge nothing for covering children. The challenge with Medicaid is not everyone qualifies for the program. State Medicaid programs are meant to cover low-income and indigent populations, and eligibility is primarily determined by income requirements.

For most Medicaid programs, the household income limit for children is 100% to 150% of the federal poverty level (FPL), or about $30,000 to $45,000 a year for a family of four. For example, a child and family could be eligible for Medicaid coverage in one state but not in another due to differences in FPL guidelines and how that state runs its Medicaid program.

In Georgia, a family of three with an annual household income of $43,846 would qualify for the state’s Medicaid program, but that same three-member family would not qualify for Medicaid in Texas, where the yearly income limit for a three-member household is slightly lower at $43,481.

Likewise, a family of four in Florida with an annual income of $35,245 a year qualifies for Medicaid. But that annual income exceeds the annual income limit for a family of four in Michigan, which is $33,000 a year.

An excellent source for determining Medicaid eligibility is InsureKidsNow.gov, or you can call your state Medicaid office to inquire about eligibility requirements.

Second choice: CHIP

CHIP should serve as a second option for parents who want child-only health insurance policies. Like Medicaid, CHIP is funded through a combination of state and federal funds, and has its own eligibility requirements that vary from state to state.

Unlike Medicaid, CHIP only covers children, usually those younger than 19. CHIP income limits are set above the income limits for state Medicaid programs, making it possible for CHIP to fill in the gaps and provide coverage for children whose parents are not poor enough for Medicaid but can’t afford private insurance.

In many states, CHIP income limits go up to 250% of the FPL — about $75,000 a year for a family of four. Although costs differ in every state — some state programs charge copays and deductibles, for example — any family contribution to the cost of coverage cannot exceed 5% of family income.

Like Medicaid, CHIP provides comprehensive health coverage. All state programs cover the following:

Some CHIP programs may cover additional services not mentioned above, but this will vary depending on the state. For more information on how to apply for CHIP, please see "Medicaid & CHIP coverage" at HealthCare.gov or call your state CHIP office.

Third option: The Affordable Care Act

Health plans provided by the ACA represent the best option for parents whose children do not qualify for Medicaid or CHIP. Parents can purchase child-only policies through the ACA marketplaces during open enrollment, which usually takes place during the fall, or during a special enrollment period. They can also purchase child-only policies outside of the open enrollment period if they have a qualifying life event.

In many cases, enrollees are eligible for subsidies through the ACA to help pay for premiums and copays, and to assist in meeting deductibles. Before 2021, you would not qualify for premium tax credits if your income exceeded 400% of the FPL, about $87,840 a year for a family of three. However, the recently enacted American Rescue Plan increased the income thresholds, so now a family of three, for example, can qualify for premium tax credits if their income exceeds the 400% threshold.

For many, the ACA plans are an attractive option because they provide an array of benefits and are available to most people. Individual and family plans under the ACA are required to cover 10 essential benefits, which are:

In most states, marketplace plans are divided into three metal tiers, and each tier gives the consumer an idea of how much they will have to pay out of pocket for coverage. The benefits for each tier are the same.

But there are wide differences in premiums, deductibles and copays with each metal tier. The higher tiers carry higher premiums but lower deductibles and copays.

Bronze: These plans have the cheapest premiums, but high out-of-pocket expenses such as copays and especially deductibles. The deductibles and copays could block or delay access to services if the parent has trouble paying them.

Silver: These plans have more modest premiums, deductibles and out-of-pocket maximums than Bronze plans, possibly serving as the most affordable for low-income families, especially with subsidies to help reduce premiums, deductibles and out-of-pocket maximums.

Gold: These plans are usually the most expensive on the state marketplaces. But the deductibles and copays are much lower than those of Bronze or Silver plans.

Some state exchanges also offer Platinum health insurance, which carries relatively expensive premiums but the cheapest deductibles and copays. For any parent, the first choice with ACA plans should be a Gold or Platinum plan if you can afford it and it is available in your state. Although the premiums are higher, deductibles and copays are much lower, providing faster access to care.

Cost is always a consideration, and not everyone can afford a Gold or Platinum plan, leaving the two other options, Bronze and Silver plans.

It is always a good idea to log into HealthCare.gov when considering an ACA plan. By entering your ZIP code into the browser, you can shop and compare ACA plans in your state. ACA plans are required to provide lists of physicians in their provider networks as well as covered drugs or formularies, making it possible for a parent to determine what drugs a particular plan covers as well as the doctors a plan contracts with. A parent may, for example, need a particular diabetes drug carried by some, but not all, of the plans.

For information on how to apply for an ACA marketplace plan, please see InsureKidsNow.gov.

Private plans and short-term options

Private insurance and short-term plans bought outside of the ACA exchanges should be the last resort for any parent or parents looking for child-only policies. As a general rule, long-term private insurance is more expensive than Medicaid and CHIP, and unlike ACA plans, private plans do not include subsidies to help defray out-of-pocket costs.

Private plans that sell comprehensive coverage outside of the state exchanges still have to comply with the protections laid out in the ACA, providing safeguards for consumers.

Short-term health insurance is another option for child-only policies. Short-term plans typically provide coverage for a year or less, sometimes for just 30 days, often bridging gaps in coverage. Some states have imposed three-month limits on short-term plans, while others have imposed six-month limits on the length of the plans. Ten states have outlawed the sale of short-term plans outright: California, Colorado, Connecticut, Hawaii, Massachusetts, New Jersey, New Mexico, New York, Rhode Island and Vermont.

Short-term plans don’t have to adhere to protections normally associated with qualified health care plans under the ACA. They can, for example, deny coverage based on preexisting conditions. If a child has a preexisting condition such as asthma, short-term policies will probably not cover that condition.

Short-term plans are typically used for protection against catastrophic events until longer-term insurance takes effect or can be found. If a child falls and breaks a leg, for instance, the short-term policy should cover the cost of fixing the broken leg. Parents should always remember that short-term plans are a temporary solution, often purchased while trying to find a more permanent type of coverage or waiting for Medicaid, CHIP or an ACA plan to kick in.

Aside from filling gaps, short-term plans have other benefits. They usually provide immediate coverage; you don’t have to wait for open enrollment or special enrollment periods, for example. The cost of child-only insurance in the short-term market also tends to be lower than the cost of other plans on the private market because the coverage is shorter in duration.