Next Generation Insurance Blog

College Health Insurance Reviewed by the Wall Street Journal

By: nextgenins

The September 26th edition of the Wall Street Journal published an article titled How College Health Plans Are Failing Students. The article written by Jessical Silver-Greenberg and Mary Pilon, is comprehensive in its discussion of the limits of many school sponsored student health plans. However, it failed to address just how few affordable choices students have if the school plan does not meet their needs.

Unlike permanent health insurance, these Student Health Plans are designed for students and often times schools are trying to balance affordability with coverage needed at that particular life stage.   Schools and insurers alike should be creating more choice for students so they can find the right plan to meet their needs while making certain all options provide acceptable standards of coverage.

NGI shares the goal of colleges that seek to mitigate the risks that could interfere with a students goal of completing an education.     Health coverage is fundamental to this goal and is addressed through GradGuard’s Student Health Plan. In addition to GradGuard’s Student Health Plan, GradGuard also offers tuition insurance, college renters insurance and the Student Protection Plan.

Please read the entire article on or to see some of the highlights included here:

Changing Regulations

The new health care legislation has immediate and potentially long term consequences for college students.

On Thursday, (blog note – September 23rd, 2010) the first big pieces of the new health-care overhaul took effect. Among other things, the rules mandate that insurance companies offer coverage to adult children until the age of 26 and devote at least 80% of their revenue to health-care costs.   But one major player was notably absent from these new rule changes: colleges. They have managed to sidestep, at least for now, the regulatory clampdown that has sent hospitals, insurers and corporations scrambling.   How’d they pull it off? Since student plans for the 2010-11 school year were negotiated before Sept. 23, they aren’t subject to the regulations this year.

The health-care overhaul has major implications for young adults and their parents. For the first time, parents will have the choice of keeping their graduate-student children on their corporate insurance plans or opting for cheaper college plans.

There is broad consensus that, as a group, college health-insurance plans rank among the worst in the nation for consumers. Many college plans come with remarkably low benefit ceilings—in some cases as little as $2,500.    Others limit areas of coverage, such as preventative services and chemotherapy.

The upshot: Students are often much less insured than they think they are. In extreme cases high-school seniors with health issues might be advised to consider a college’s health plan before attending.

The college health-care system is a hodgepodge of school plans and private insurance. According to the Government Accountability Office, more than half of the nation’s colleges offer school-sponsored plans. All told, about 80% of college students, nearly 7 million people, are covered by private or public health insurance.…

Most schools aim to provide the best care for the lowest cost. Students tend to be healthier than the general population, so school plans don’t need the safety nets found in adult plans.

Change in Status of Group Plans?

The WSJ article goes on to discuss the debate surrounding how the new health care legislation applies to college sponsored plans.

The American College Health Association “is supporting regulatory clarification that would allow student plans to preserve the grouplike status that is vital to providing lower cost coverage to students,” says Jake Baggott, ACHA’s advocacy coalition chair. Dr. Turner, ACHA’s president until June, says the spirit of his conversation with the White House was that “they would be happy to include in the regulations the necessary language to assure preservation of the plans.”

Insurers seem to be confident they will get their way. According to three people familiar with the matter, Aetna has told colleges that they have nothing to worry about because their plans will be exempted. Aetna says it never conveyed that message to its members. “We expect that all student plans that wish to be credible will comply with minimum coverage requirements as soon as possible,” says Ethan Slavin, a spokesman for the insurer.  Good insurance plans are marked by a few elements, among them benefit ceilings of at least $250,000, generous prescription drug plans and emergency room coverage. According to the GAO, more than half of all school plans have ceilings of less than $30,000.

Parents and students can get the most for their money by carefully examining school plans before signing up. Health-care planning should come long before enrollment, says James A. Boyle, president of the College Parents of America, a Virginia-based nonprofit.

Questions to Ask

Anyone considering a school plan should ask a number of questions, say experts:

• What is the maximum benefit for the policy?

• Are prescriptions and mental health services included?

• What happens to coverage if you leave school, go abroad or graduate?

• What is the loss ratio?

• Do any on-campus services, such as checkups or flu shots, overlap with existing coverage?

Parents who are considering keeping their child on their personal insurance should ask their benefits representative or insurer about how coverage will be carried over on campus and off—especially at schools far from home. (This also applies to graduate students and to adult children under age 26.) They should also be ready to sign a waiver with the school so they’re not charged for automatic enrollment in a campus policy.

If, after getting all these answers, both the employer and school insurance options seem unappealing, parents should consider using a site like, which allows for comparison browsing among 10,000 plans from 180 carriers.

Blog Note – eHealth provides the GradGuard Student Health Plan as its national alternative for students.

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