Correction: An earlier version of this story gave the incorrect cost for the mandatory student health insurance at George Washington University. The fee is $2,651 a year, not $4,103. The story has been updated.
If you have a kid in college, you may be double-paying for their health care coverage. Most four-year universities offer a student health Insurance Plan, and many automatically enroll students in the plan. When he was attorney general of New York, Andrew M. Cuomo warned 300 colleges that they needed to “clearly and conspicuously disclose” this mandatory coverage and itemize the cost. Student health insurance plan prices vary drastically, from $1,750 a year at American University, for example, to $2,651 a year at George Washington University.
Either way, that’s a sizable chunk of money to pay if your child is already covered by your own plan. And more offspring than ever are, because of a provision in the Affordable Care Act that allows children to stay on their parents’ plan until their 26th birthday. (Proposed Republican bills to replace the ACA keep this provision intact.) In fact, parents may be paying a collective total of $1.2 billion in redundant health insurance costs, according to a study by Keybridge Research.
So you should definitely find out whether your child’s college is one of those that automatically enrolls students in its health plan. But before you rush to opt out, keep in mind that there are pros and cons to both choices — college health plans and parent health plans. Here are the main things to consider in making the decision.
Is the plan a “self-insured” plan or is it run by an insurance company?
College health plans administered by insurance companies have to meet minimum coverage standards set by the ACA. “Self-insured” plans, in which colleges pay claims directly, are not required to meet those standards, although some still do.
Is the plan effective 12 months a year? Or just during the school year?
Many college health plans are effective 12 months a year. If the policy is only in effect nine months a year, you may need a short-term health plan or catastrophic coverage (which covers people in the event of a major accident or illness) to fill the gap.
Is the campus clinic a small, student-only facility or a large, university teaching hospital?
Some campus clinics are one- or two-room facilities with staff prepared only to treat common ailments, such as the flu or urinary tract infections. Others are world-class hospitals with every possible kind of medical practice attached to them.
Does the plan cover care only at the campus health clinic?
Some student plans do allow access to hospitals near the university. If not, the campus clinic may not be sufficient if the student has complicated existing health problems, gets in a major accident or contracts a serious illness .
Is there a distance limit ?
If the plan does allow students to visit off-campus doctors and hospitals, is there a mileage limit? Some plans only cover visits near the school, which is a problem for students who are attending college far from home and may need medical care while visiting their parents. Or it could make it difficult to find providers who are in-network while a student is at home.
Is the plan part of tuition?
If it is tied into the total cost of the student’s education, financial aid or student loans will probably cover it, which could be helpful if cash is tight.
Is the parent plan a multistate plan? Or is it issued in the same state as the college?
Some HMOs and PPOs have networks of doctors and hospitals in only one state. Others are much broader and cover multiple states. Does the parent’s plan offer in-network care in the same state as the college?
Does the campus health clinic accept the parent’s insurance plan?
Most often they do not. This means students must pay for care out-of-pocket and then submit a claim to the parent’s insurance company. The paperwork can be a hassle and many claims are rejected.
If the campus clinic accepts my insurance, is it considered in-network?
If you are lucky enough that the campus clinic does take your insurance, find out if it is considered “in-network” or “out-of-network.” Often patients have to pay 10 to 20 percent of their medical bills for in-network coverage but 30 to 40 percent for out-of-network providers.
Is the student’s college in a location with lots of health-care options?
If the college is in a large urban area with lots of nearby doctors and hospitals, maybe skipping the campus health clinic will not be a burden. But if the college is in a small town or rural area, getting outside care could be challenging.
Will the student have to call their hometown doctor for referrals?
Many HMO-style plans and some PPO plans require a referral from your primary care doctor before you see a specialist. If there are no in-network doctors near the college, the student could have to coordinate with a hometown doctor, which can be a pain.
Does the parent’s plan charge the same amount for “one or more” children?
This is common and means that if there is more than one child in the family, each additional child is covered by the parent’s plan free. In this case, switching to the campus health plan is definitely an additional cost.
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