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Student health insurance may become mandatory

By fall 2012, incoming USF students may be required to show proof of health insurance to enroll in the University.

Students will have the opportunity to express their opinion on the new policy during the Student Government (SG) elections in February, according to Assistant Vice President for Student Affairs Alan Kent. However, this will not mark the first time the proposition appeared before students.

Last year, SG placed the mandatory health insurance issue on the ballot to gauge student opinion and garnered a negative response, he said.

“There was no information, no education, it just showed up,” he said. “Of course, if you say to someone, ‘Do you think we should have mandatory health insurance?’ they’re going to say no.”

Yet, Kent and Senior Director of Student Health Services (SHS) Diane Zanto said they believe students will be supportive once they understand what the mandate is trying to accomplish.

Currently, only international students, and some graduate students and students in the USF Health program are required to have health insurance for enrollment, Zanto said. USF does offer a health insurance plan for students, but it is purchased voluntarily and would remain that way even if the mandate is enacted.

“I think one of the biggest questions that has come up is the worry that people are going to be forced to buy the USF insurance product and that is absolutely not the intent,” Zanto said. “The only reason why we offer the insurance plan is so students have access to something that’s affordable and something that’s a quality plan. There’s no financial incentive for USF to sell insurance. We just go out and try to find the best product for the best price for students so that they have options.”

In fact, it is the rising cost of the USF health insurance policy that spurred discussions of the mandate, she said.

Only about 4 percent of students enrolled at USF have purchased the University’s health insurance plan, causing the cost to increase from $1,600 to $2,400 per year with a “139 percent loss ratio.” The usual loss ratio anticipated by insurance companies is 80 percent, Zanto said.

“What that means is that they expect that for every dollar of premium paid they will pay out 80 cents in claims to the insurance company, so they have 20 cents profit to use for their overhead, which is a good, solid industry figure,” she said. “Last year, in terms of premiums paid, they paid out $1.39 in claims – meaning they lost 40 cents on every dollar on the insurance plan they offered our students.”

Kent said this is because the students who chose to purchase the plan typically did so because they had medical issues and needed to use it.

“(USF) has a little bit more of a non-traditional population,” he said. “We have some older students, we have more transfer students, and typically if you are 18 or 19 and your parents work, you’re probably going to be covered on your parents policy. So the students that we have that have bought the plan are a little bit older, maybe, and are using it more. We know that if we do nothing, we’ll be in a position of not being able to offer anything to students, which would really be unfortunate.”

If the mandate were to be enforced, Zanto said students would be required to provide their policy numbers for enrollment.

No changes would be made to the care provided by SHS or the benefits provided by the university insurance plan. The only change would be a lower insurance cost and a “higher” tuition – providing “absolutely the best argument for why mandatory health insurance is important,” Kent said.

“If it’s mandatory, the federal government looks at that as part of your tuition and fees and then it’s rolled right into financial aid, you just add it on to your financial aid package,” he said. “You can go anywhere you want to buy it and you can roll it into your student bill. But if it’s mandatory, then the policy we get – the costs will be so much lower.”

This would allow students to purchase any insurance plan with the help of financial aid. Conversely, if a student already has health insurance, their tuition would be unaffected.

A significant drop in insurance costs would also help the estimated 20 to 25 percent of USF students who are currently uninsured afford plans, Zanto said.

If USF decides to make health insurance mandatory, the Board of Trustees would submit a “request for proposals,” Kent said, alerting health insurance companies that there would be a large pool of healthy students in need of a plan and asking for the best price they would be able to provide as the University’s plan.

A student health advisory committee would then select a university plan based on benefits and affordability.

According to a report released by the State University System’s Student Health Insurance Task Force, about 28 percent of states mandate that all college students purchase health insurance and 40 percent are on a college-by-college basis.

Currently, Florida State University is the only public state university to mandate health insurance. As a result, its students’ insurance rate this year was $1,415, compared to $2,534 at USF.

“One visit to the emergency room could probably cost about what it costs to have health insurance for the whole year in some cases,” Kent said. “I know the students who don’t have insurance would be in favor of this because it’s going to make it affordable for them. And for the students who already have insurance, this won’t affect them. So now, it’s just really helping students understand the bottom line. I believe they would be supportive.”