Colleges need to examine student health insurance
Though college-sponsored health plans can be cheap, many are not providing enough coverage for students, according to a report released on Thursday from Andrew M. Cuomo, attorney general of New York.
After investigating private insurance companies that lend through universities for more than one year, Cuomo found that student plans often don’t cover enough, and companies are making way too much profit.
“A bad health-insurance plan can have catastrophic and long-lasting effects on a young person’s life,” Cuomo said in a statement. “Schools can negotiate for better plans.”
The report was based on information Cuomo obtained from subpoenaing 10 of the largest student insurers in the nation and five insurance brokers, agents and consultants.
Cuomo sent more than 300 letters to colleges in New York and across the U.S., warning them to review their agreements with health care providers. This wouldn’t be a bad idea for any university. All schools should ensure that the plan they offer students provides enough coverage for a reasonable price.
The report found that about 1 million U.S. students have college-sponsored private plans, which generate $1 billion per year in revenue for insurers. Cuomo thinks that’s too much profit.
In his letter, he echoed the new federal law by recommending schools look for providers with a loss ratio of at least 85 percent. That means insurance companies should pay out in benefits at least 85 percent of what they earn from students.
While some plans offer low premiums to students, coverage can be as low as $25,000 annually and $700 per illness, according to the report. Some don’t cover pre-existing conditions or prescription drugs.
Schools need to pay closer attention to the kind of coverage they offer, especially since an increasing number of them are requiring students to have some kind of health insurance for enrollment.
According to the American College Health Association, 38 percent of public colleges and 79 percent of private institutions require health insurance, either from the school or under a comparable plan.
USF hasn’t made it mandatory but offers a plan through Blue Cross Blue Shield of Florida.
Colleges across the nation should look into the suggestions Cuomo made in his letter. They should look for insurers that don’t put caps on annual or per injury benefits. Health care reform now seems inevitable, so schools should use the changes in a way to best benefit students.