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Student Health Plans and Health Insurance for College Students

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The largest group of Americans without health insurance is comprised of young adults between the ages of 18 and 24 years old, many of them college students, but things may be looking up for some.

The recent health care reform has caused quite a bit of controversy among Americans, but Section 2714—which went into effect earlier this week— is an extension of dependent coverage which states that a group health plan and a health insurance issuer offering group or individual health insurance coverage that provides dependent coverage of children shall continue to make such coverage available for an adult child (who is not married) until the child turns 26 years of age.

Fewer Young Americans without Health Insurance

The goal of policymakers responsible for this provision is simple: to have fewer uninsured young Americans.

According to a 2008 report released by the Government Accountability Office, approximately 1.7 million traditional-aged American college students, or 20% of them, are uninsured. According to the Los Angeles Times, nearly one third of all Americans between the ages of 18 and 24 years old lacks health insurance.

As reported by Inside Higher Ed, 67 percent of college students in 2006 received health insurance through employer-sponsored plans, which cover employees and their dependents. Those more likely to be uninsured include part-time students and older college students—students that were age 22 or 23.

New College Grads can Remain on their Parents’ Health Insurance Policies

College students that were on their parents’ insurance plans during school were typically instantly removed following graduation. If they have yet to secure employment which comes along with the benefit of health insurance, which is the case for many job-hunting new grads, they wind up instantly uninsured. Section 2714 should help ease the student-to-employee transition.

The extension of dependent coverage became official on September 23, 2010 but to prevent disruptions in coverage for those graduating from college, many health insurers including Aetna, Humana, WellPoint, CareFirst BlueCross BlueShield and United Healthcare extended policies immediately after the overall health care law passed in March.

Student Health Plans: Choose Wisely

Obviously, remaining on their parents’ health insurance isn’t an option for students whose parents don’t have health insurance, but several student health plans are available—many of them provided directly through a student’s college or university. The plans are traditionally only active during the school year and can range anywhere in cost from $30 to $2400 per year, but beware—the Government Accountability Office found that some plans exclude or limit preventative care, prescription drug coverage and other basic health services.

Inside Higher Ed provided insight from Dana Mills, chair of the American College Health Association’s Student Health Insurance Task Force. She is also the director of student health service at Marquette University. “I think one of the take-home points is they did review actual student health insurance plans across the country and we saw a big variation in costs and benefits and features of the plans. For each of us on our campuses, we need to look and see what kind of value are we getting out of our student health insurance plan? Is it something that is meeting the need? Are we only concerned about the costs and not opening it up and seeing what the benefits are?”

Attorney General Investigates Student Health Plans

A 17-month investigation initiated by New York State Attorney General Andrew M. Cuomo’s office also found disturbing results regarding student health plans. An April 2010 New York Times article reported that many health insurers were shortchanging college students, often paying out far less in benefits than they collect in premiums.

Most colleges and universities claim to offer basic student health plans which allow college students to get medical attention when they need it. Some colleges negotiate student coverage from major insurers, but others offer what seems like low-cost plans—which are among the most lucrative for the insurance industry. The new federal health care law will require large plans, including most college plans, to have loss ratios of at least 85 percent.

The provision of the health care bill providing young adult dependent extended coverage is one of the least controversial provisions, and hopefully it will help benefit recent college graduates and college students above the traditional age—as long as they’re under 26 and unmarried, of course.


Melissa Rhone+

Melissa Rhone earned her Bachelor of Music in Education from the University of Tampa. She resides in the Tampa Bay area and enjoys writing about college, pop culture, and epilepsy awareness.

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