Health care isn’t something most students worry about. Government stats show about 80 percent of college students are covered under a parents’ plan. For them, Obamacare may mean they can keep the insurance they already have for a few years beyond college, but it won’t affect the coverage they carry during school.
But what about kids without parental coverage? The new law’s requirement that insurance cover children up to age 26 won’t make any difference for them.
Currently, college students without coverage can enroll in low-cost student health plans offered through universities. These plans may include limits to keep costs down, but are often designed around to complement university health services to provide comprehensive coverage. Affordability is further achieved by rating student health plans on a campus-wide basis rather than according to the whole individual market.
Seven percent of students currently receive coverage from their school, but that could change under Obamacare, a concern that the American Council on Education expressed in a recent letter to Health and Human Services Secretary Kathleen Sebelius.
“The application of several provisions under the Patient Protection and Affordable Care Act (ACA), including certain insurance market reforms and the individual mandate, could make it impossible for colleges and universities to continue to offer student health plans,” the Council warns.
As the new law currently stands, it’s unclear whether student health plans would meet federal requirements to qualify as minimum essential coverage. If they don’t, students would have to find coverage elsewhere or pay the individual mandate in addition to the premiums of their student health plan.
Though the law includes a rule that institutes of higher education will not be prohibited from offering student insurance plans, the Council explains that problems arise because, “Short-term limited duration insurance, including many student health plans, does not qualify as either group health insurance coverage or individual health insurance coverage under the existing Public Health Service Act (PHSA) definitions. As a result, a student with comprehensive SHP coverage would not satisfy the minimum essential coverage requirement due to a definitional technicality.”
Schools may also find that some provisions of Obamacare might forbid them from offering coverage solely to their student populations, rather than the individual market at large.
Critics of student health pans, who see these low-cost options as inadequate, would prefer to apply Obamacare’s rules to student coverage. But, as Julie Appleby writes for Kaiser Health News, colleges fear that “requiring them to meet even some of the new rules could drive up premiums.”
Removing affordable options would likely discourage many students from carrying insurance altogether—yet another example of how Obamacare, which was supposed to improve insurance coverage, may end up making it worse.