College students in America face particular challenges in paying for health insurance, and consequently are more likely to be uninsured than any other segment of the population. Experts estimate that between 10% and 20% of the uninsured are college students aged 18 to 24. This substantial chunk of the citizenry is taking enormous risk; students who experience illness or injury can rack up enormous debt before they ever earn a salary, and uninsured students don’t receive preventive care that can discover and treat many illnesses in their early stages.
Fortunately, the U.S.’s massive healthcare reforms pay special attention to this high-risk age group. One of the earliest provisions of the Affordable Care Act (ACA) allowed parents to continue carrying students up to age 26 on a family health plan. Other provisions, such as the removal of pre-existing condition clauses and the expansion of Medicaid, eliminated some of the barriers students face when purchasing health insurance.
Students who attend college online may find that online-only schools don’t offer their students health insurance plans. While this is largely true of exclusively online schools, hybrid degree programs tied to a brick-and-mortar campus often allow online students to purchase a student health plan. These plans are offered by the school, usually in partnership with one or more health insurance providers.
The ACA’s Impact on Students
Mandates of the ACA, made effective Jan. 1st, 2014, require campus insurance plans to contain more comprehensive benefits. While campus plans may have previously covered catastrophic events or uncomfortably high deductibles, offerings are now aligned with ACA mandates. All student health plans must contain essential benefits, defined by the ACA as:
- ER services
- Maternity, newborn and pediatric care
- Lab services
- Ambulatory patient services
- Rehabilitative services and equipment
- Behavioral health and substance abuse treatment
- Preventive services and chronic illness management
Within the framework of these essential benefits, student health plans offer coverage at low premiums. The cost is going up, however, as schools revise their plans to meet ACA guidelines. Currently, a private 4-year university charges about $2,200 per year for insurance. Many colleges are now automatically opting students into health plans. It’s wise to pay close attention to your tuition bill if you opt to purchase health insurance elsewhere.
College students may find a campus plan to be too restrictive. For example, a student who attends school out of state may not be covered while at home on summer break, or vice versa for students covered under family plans. For these students, purchasing health insurance on the ACA’s Marketplace may end up being better.
What’s Required of Students Under the ACA?
Not all students are required to purchase health insurance from the new exchanges. However, they are required to purchase it somewhere; any student with an income of over $10,000 is mandated to purchase health insurance or pay a penalty for noncompliance. Additionally, many colleges now require students who don’t use campus insurance to provide proof of insurance from an alternate provider. The open market for healthcare plans will still exist, and you may be more comfortable working with an insurance agent to purchase a more traditional single-payer plan.
As we near 2015, all students, online or otherwise, must familiarize themselves with their current coverage levels and the ways in which the ACA minimums may impact them. The steps are easy:
- Find out if you need to purchase insurance.
- Check out what your school, employer or parent coverage options are.
- Compare these coverages with the plans offered in your state’s exchange.
- Choose a plan and notify your former providers of any changes.
The ACA Marketplaces: What You Need to Know
- If you are currently uninsured, you must enroll in a plan by February 15, 2015.
If you are not insured by this date, you will be fined of up to 2% of your yearly household income or a minimum of $325 per person and $162.50 per child under the age of 18. If 2% of your income is higher than $325, that is what you are expected to pay. Subsequent years where you are not insured, the rate is raised by either another percent, a half percent or an adjusted percent based on inflation.While plans will cover more and generally cost less, enrollment period limitations will apply. For 2015, the open enrollment window begins on November 15, 2014, ending, as stated above, on February 15, 2015.
- If you need insurance, you can compare policies and apply directly from your state’s Marketplace website.
Under the ACA, each state will offer an insurance Marketplace, an exchange that allows consumers to choose among low-cost, comprehensive healthcare plans offered by both federally subsidized . You can easily view and compare your state’s marketplace plans through this directory. Through this exchanges, you will still be able to enroll in a single-payer plan that doesn’t tie to a geographic location. These may be a better option for some online students.
- On the Marketplace, you have four levels of plans to choose from: platinum, gold, silver and bronze.
Plans that qualify for listing on the exchanges are guaranteed to contain all essential health benefits the ACA deems necessary. Plans will offer four tiers of coverage based on your individual needs. While most states have yet to unveil pricing structures for their exchanges, the states that have indicate much lower premiums than have been previously available. According to the Wall Street Journal:
- Bronze plans will cover 60% of standard medical costs
- Silver plans will pay about 70% of costs
- Gold plans will pay about 80% of costs
- Platinum plans will pay about 90% of costs
- As a student. you probably qualify for reduced cost or extended coverage plans.
Students are one of the many groups that are eligible to pay less under these exchanges. For instance, unmarried students under 26 now receive automatic coverage extension through their parents coverage plans. You won’t need to file a specific petition for discounted coverage, you can just apply through the standard channels and be automatically considered. To apply for coverage in the Marketplace (and to be considered for reduced rates) you’ll need to provide the following information:
- Social Security Numbers for you and any of your dependents
- Employer and income information for you and anyone else to be included under your plan
- Policy numbers of all current existing plans
- Employer Coverage Toolplan forms that explain the details of the coverage sponsored by you or your family members’ employers
Understanding Your Medicaid Option
Thanks to the flexibility in scheduling and the ability to learn from a home environment, disabled students, in particular, may find online school coverage options to be appealing. This student population may benefit from another provision of the ACA: the expansion of the Medicaid program.
Medicaid is a state-run resource for health insurance coverage. Prior to the passage of the ACA, Medicaid eligibility was severely restricted due to extremely low-income qualifications. Effective in 2014, Medicaid is being broadened to include a much larger segment of the population:
Though state participation is optional, participating states will raise the minimum income eligibility to 133% of the Federal Poverty Level (FPL). You can check to see if your state will participate in the Medicaid expansion. This means that a family of four making less than $30,675 qualifies for Medicaid coverage.
Disabled students and independent students with low income can both take advantage of this to acquire very low-cost health insurance.
Ultimately, the biggest changes of the new system will be felt by those that are not currently insured. Next year, you will need to have insurance or you will have to pay a penalty. That means that students that do not receive coverage through their schools, their employers or their parent’s plans will need to shop for and enroll for plans through their state’s exchange programs. Luckily, the ACA has also made getting coverage less complicated and less costly for most groups, especially students.