The White House has released rules concerning the provision in the health care reform law that allows young adults to stay covered under their parents’ insurance up to age 26. The U.S. Department of Health and Human Services has estimated this proposal would expand access to 1.2 million young adults across the country.

The rules do not go into effect until September 23, although several insurance companies across the nation, including Wellmark Blue Cross and Blue Shield of Iowa, have elected to implement the policy earlier.

Trends show that patients in the young adult age group are less likely to have insurance, which places burdens on hospitals in areas with high volumes of young adults. Mike Tretina, CFO at Mary Greeley Medical Center in Ames, home to Iowa State University, says that the hospital has budgeted $670,000 in uncompensated care to offset the cost of treating students or other young adults who do not have insurance.

Tretina hopes that the new provision will help to encourage parents to add their children to their coverage to reduce the number of young adults who are uninsured, and thereby reduce uncompensated care costs for hospitals.

Since 2008, Iowa law has allowed young adults up to age 25 to stay on their parents coverage.  The new federal provision adds an additional year, but it’s up to parents and young adults to take advantage of these benefits.

Nationwide, according to a White House fact sheet, estimates show that young adults comprise the largest percentage of uninsured of any age group, with an estimated 1 out of every 5 uninsured American falling in this age group.