Navigating College Student Health Insurance
Getting sick is expensive. Whether you’re an 18-year-old college freshman who heard your parents sigh when they opened a doctor’s bill or an adult learner who has had to deal with medical bills for a long time, you may be trying to figure out how to keep yourself healthy and your medical bills low while you’re attending school.
Enter health insurance.
The main purpose of health insurance is to protect the insured from medical expenses that are both unexpected and unaffordable. But health insurance can be very confusing. When you research a plan, you may be shocked by the sticker price, have to read through pages upon pages of fine print, figure out legal jargon, and more.
This guide is here to help. We’ll be discussing how health insurance works, why college students should have it, how to obtain it, and its costs and restrictions. Then, we’ll help navigate the waters of choosing an insurance company, determining if you qualify for government assistance, what to do if a claim is denied, and how to handle it if you can’t afford any available major medical options.
How Does Health Insurance Work?
The premise of health insurance, much like auto insurance, is simple: You pay a predictable amount each month, called a premium, for coverage. In turn, that coverage helps you pay what may be high medical costs in the event of illness or injury.
For example, say you’re injured in a serious car accident. Paying out of pocket could cost you tens of thousands of dollars.
With health insurance, you’d only be responsible for paying your expected monthly or annual premium and, depending on your plan, a potential copayment or deductible. Copayments and deductibles are agreed-upon out-of-pocket costs that the insured person pays as part of the insurance plan.
Health insurance also negotiates with medical providers to get you lower costs for services you receive. In short, health insurance keeps your medical costs at lower, more predictable levels. However, the premise’s simplicity doesn’t mean everything is straightforward in practice.
What Does Health Insurance Cover?
Though all plans differ, major medical plans (which are comprehensive rather than only for short-term or specific issues) generally cover basic preventive services, such as annual checkups, vaccinations, and certain health screenings such as pap smears. These may be entirely covered, or you may also be required to pay copayments or pay a percentage of care up to a deductible limit in a given year.
As required by the Affordable Care Act (ACA), all health insurance plans offered in the federal health insurance marketplace cover these 10 essential health benefits:
- Ambulatory patient services (outpatient care without hospital admission; this does not mean ambulance rides)
- Emergency services
- Pregnancy, maternity, and newborn care
- Mental health and substance abuse disorder care
- Prescription drugs
- Rehabilitation services and devices
- Laboratory services
- Preventive and wellness services (includes chronic disease management)
- Pediatric care, including oral and vision care
Insurers aren’t required to offer vision and dental benefits, and many plans don’t. Mental health services may also be limited.
Does Insurance Cover Pre-Existing Conditions?
According to the ACA, as of January 1, 2014, health insurance companies have been prohibited from refusing coverage or charging more if you have pre-existing conditions, meaning health problems you had before your coverage starts.
The only exception is for grandfathered plans, meaning any insurance plan you may have purchased before March 23, 2010, that hasn’t changed its coverage for pre-existing conditions.
I’m Young and Healthy. Do I Really Need Health Insurance?
To many young people who don’t have ongoing health concerns, the risk of a major medical event may seem minimal and not seem worth the cost of insurance. Plus, coverage isn’t required by federal law. However, there are several reasons why you might still need health insurance:
It’s still required by law in certain locations.
In New Jersey, Massachusetts, Vermont, and D.C., residents are required to carry health insurance. Those who don’t are charged penalties.
You may qualify for a tax break.
If your healthcare expenses for the year exceed 10% of your adjusted gross income (AGI), you can deduct that amount on your tax return.
Your college probably requires it.
Most colleges and universities mandate health coverage as an attempt to mitigate student debt. This is especially true for students enrolled in medical and nursing programs, such as those at Duke University.
Mental health issues often develop around college age.
College students experience high rates of stress, and one in four students are diagnosed with or treated for mental health disorders such as depression and anxiety.
Anyone can get sick.
No matter how great your immune system has always been, you can still get sick. College students are more likely to deal with poor nutrition and lack of exercise; sexually transmitted diseases; colds, flus, and sore throats; meningitis; sleep disorders; and many other communicable diseases than the general population.
Catastrophes can happen to even the healthiest of people, including workplace disasters, car accidents, and more. Even tripping on the sidewalk as you walk to class can result in a broken bone, and the costs of treatment can be excessive. For instance, a broken arm without surgery can cost $2,500 or more, and if you need surgery, you’re easily looking at $16,000. And a broken leg? $35,000 for treatment with surgery isn’t considered outrageous.
Do I Need Accident Insurance? What is Accident Insurance, Anyway?
Like its name suggests, accident insurance covers you if you’re injured in an accident.
An accident insurance plan provides a one-time payout for your treatment—doctor visits, procedures, medications, etc. It may also include reimbursing you for any loss of income you may incur as a result of your injury, and help you pay your household bills, which differs from regular health insurance.
The plan may cover such injuries as bone fractures, lacerations, burns, tooth damage, or concussions. Policies are relatively inexpensive—often $20 or less per month for the young and healthy. However, it doesn’t cover illnesses, and if you aren’t injured in an accident, you may never receive any benefit for coverage.
In short, accident insurance coverage is likely less costly than health insurance, but whether it’s wise to rely on accident insurance only is very much a judgment call.
Can’t I Stay on My Parents’ Health Insurance?
If your parents’ plan covers dependents, you can remain on the plan until you turn 26—usually on your birthday for job-based plans and December 31 of that year for the federally facilitated marketplace plans. This is the case even if you get married, have a child, move away, or are offered coverage by your employer.
However, relying on a parent’s plan may not be ideal.
First, your parents may be among the 31 million U.S. citizens who aren’t insured.
Depending on your living situation or the requirements of their plan, you may struggle to find in-network care providers who will accept your insurance. This is especially true if you attend college in a state different from your parents.
Remaining on your parents’ plan might cost more and offer less coverage than a new policy.
Your parents also may be notified about your medical and mental health practitioner visits or prescriptions you have filled if you use their insurance. If you prefer your medical information to be private, you might want to seek your own policy.
You can’t stay on their policy indefinitely, so it’s a good idea to start shopping on your own if it’s financially feasible.
Can I Get Health Insurance Through My School?
Because most colleges and universities require that students carry health insurance, many of them offer it. About 10% of students take advantage of this option.
Often this coverage applies to local providers, and financial aid offers may be applied to it. Additionally, if your university has a medical school, providers associated with it are likely to be on the plan.
However, this coverage may only be applicable during the academic year, leaving you to purchase additional coverage for summers. Eligibility may also be contingent on enrolling in a minimum number of credit hours.
How Do I Get Student Health Insurance if My School Doesn’t Offer It?
In general, students have three options for health insurance coverage if they can’t use their parents’ plans or get student insurance from their schools:
- Purchase a plan from a private insurer or through the federal government’s health insurance Marketplace website.
- Take advantage of your employer’s health plan (which may require you to be employed full time).
- If you’re eligible, receive coverage through Medicaid or the Children’s Health Insurance Program (CHIP), which offers free or low-cost health coverage to qualifying low-income, elderly, and disabled Americans.
Can I Get Health Insurance If I’m a Minor?
Because insurance policies are considered legal contracts, you can’t secure your own policy until you’re at least 18 years of age—even if you’ve graduated from high school.
The exception to this is legally emancipated minors, who may be able to obtain coverage themselves. Your best option if you’re in this situation is to consult a lawyer or social worker.
How Long Does Student Health Insurance Last?
Most student insurance plans expire upon graduation. This is one benefit of remaining on your parents’ plan—avoiding the fall off the insurance cliff after you graduate.
You might consider purchasing a short-term insurance plan, which is available to graduates in all but 11 states. These plans offer low premiums, though they don’t cover pre-existing conditions, as the law only requires mandates this for major medical coverage. Short-term insurance may help you address the coverage gap until you can enroll in your own long-term plan, either through an employer or during the ACA’s open-enrollment period.
How Much Does Student Health Insurance Cost?
Student health insurance plans vary in their coverage periods, coverage amounts, and premiums. The average student plan costs between $1,500 and $2,500 per year, though some schools may charge less or more. This premium may be listed as a “fee” on your tuition statement.
Major student health insurance providers include some of the most recognizable names in individual insurance, such as Cigna, Aetna, Blue Cross Blue Shield, Humana, and United Health.
What Are Premiums and Deductibles?
Health insurance costs can generally be grouped into two categories: premium and deductible. To select the best plan for your needs, you need the right combination of the two.
Premium: This is how much you pay each month for the plan. It’s predictable and may be affected by factors including your health risk, income, age, and more.
Deductible: This is the amount you have to spend on your healthcare before your insurance company picks up the tab. It generally excludes preventive services, which are often covered at no cost to you or with a small copayment.
Typically, the higher your deductible is, the lower your premium is, and vice versa.
When you’re shopping for a plan, consider whether you’re willing to risk paying a high deductible in case you become ill or injured in order to keep your monthly premium low, or if you’d rather pay a bit more each month to ensure your immediate out-of-pocket deductible will be lower if something goes wrong.
How Do I Know if a Student Health Insurance Company is Right for Me?
To be sure a student health insurance plan will suit your needs, you should weigh a few important considerations:
- What is covered under the plan, and will that effectively address my needs?
- What is the plan’s quality rating (up to five stars) according to HealthCare.gov?
- What are your total costs, including premium and deductible? Can you afford it?
- What providers and healthcare facilities are included in the plan, and will you be able to use the provider(s) of your choosing?
What Are Some Health Insurance Companies I Should Consider as a College Student?
We’ve rounded up some information about several major health insurance providers to help you find the plan that’s right for you. However, this is by no means an exhaustive list of providers.
Your college or regional healthcare system, for example, may offer plans uniquely tailored to residents and students in the area.
Conduct plenty of research before settling on a plan. One place to start is with your prospective college’s health center, as its staff is likely to be knowledgeable about the value of the school’s plan—if available—and other private insurers.
Consider your current and near-future healthcare needs, whether you’re more interested in a low monthly premium or a low deductible, and if any potential gaps in coverage (for example, during summers) could present problems for you. And remember, plans may vary by state, so be clear about where certain plans are available.
Health Insurance Marketplace
The Health Insurance Marketplace was created as part of the ACA to help ensure all legal residents of the U.S. can get health insurance.
It’s available in every state. Most use HealthCare.gov for enrollment, but some states require residents to apply on other sites. Be careful of fraudulent sites saying they offer ACA or “Obamacare” coverage—use the Marketplace link above to access all legal applications.
- Fairly clear rates: A lot of insurance companies’ information is hard to sift through. The Marketplace breaks its plans down in simple terms, and you can get a price estimate based on your situation.
- Thorough mental health coverage: All Marketplace plans cover behavioral health treatment, inpatient services, and substance use disorder treatments. In general, mental health services can’t cost more or provide less coverage than physical health treatments.
- Income levels affect coverage eligibility: You have to meet certain income requirements to qualify for savings via the ACA. If your situation changes, you must report the change to the Marketplace, affecting your coverage on the spot.
- Narrow networks: As of 2019, 72% of Marketplace plans have “narrow markets,” meaning fewer doctors to choose from if you want in-network coverage. While this lowers costs (and no plan allows you to visit every single doctor), this could significantly impact access to your preferred providers. Check your plan’s coverage before enrolling.
Aetna offers student insurance plans through approximately 200 universities nationwide and is one of the nation’s largest and most recognized insurance carriers.
- It has a good reputation: AM Best awarded Aetna an A (Excellent) rating in 2020.
- It’s affordable: Aetna offers relatively low premiums, which may be preferable to low-income students.
- Coverage offers unexpected perks: Plans may include coverage for such unexpected services as massage therapy, over-the-counter vitamins, acupuncture, or weight-loss programs. You may also qualify for tuition reimbursement if you’re sick or injured and unable to complete school.
- Deductibles may be higher: With lower premiums come higher deductibles.
- Locations may be limited: Coverage may not be granted in all states.
Blue Cross Blue Shield
Blue Cross Blue Shield is made up of a network of 35 independent, locally operated companies that enables coverage, including student plans, in all 50 states and the District of Columbia.
- It offers extensive reach: With coverage in nearly every zip code, you’re likely to find a plan with providers in your community. In fact, 96% of hospitals and 95% of doctors contract with BCBS.
- It’s customized: Because it offers community- and school-specific plans, coverage is usually tailored to your unique student needs.
- Access can be confusing: It’s precisely because of the network of independent companies making up BCBS that it can be confusing and difficult to reach representatives for questions about coverage.
- Policies may be inconsistent: Each member of the BCBS system may offer a unique mix of coverage, meaning that your friend’s policy at their college may not be available to you at yours.
National Student Nurses’ Association (NSNA)
The NSNA offers a health insurance exchange called Augeo Benefits that allows members to find policies available both on and off the ACA Marketplace and fit their needs and finances. This includes major and short-term medical, dental, life, accident, critical illness, and disability insurances.
- It’s available in all 50 states: No matter where you live, you can find options for coverage.
- You’ll have help from an agent: When you use Augeo, you gain access to a licensed health insurance agent who can answer questions and help guide you to a plan that’s right for you.
- Supplemental plans are available: In addition to major and short-term medical, you can also find accident, disability, or critical illness coverage to supplement an existing plan.
- You may not be eligible: If you aren’t a member of NSNA (which involves yearly dues) or if you’re eligible for employer-sponsored coverage, you can’t use the Augeo marketplace.
- Massachusetts residents are limited: Major medical coverage through Augeo isn’t available in Massachusetts, though you may be able to use their other types.
Based in Minnesota, United Healthcare is the largest health insurance company in the United States, with a network of 1.3 million healthcare providers and 6,500 hospitals. It also offers some of the most distinctive and comprehensive student health plans available.
- Rates are lower: United offers comprehensive plans at affordable prices designed with financially strapped students in mind.
- Coverage may be better: Because these plans are customized for students, they may offer better coverage for such services as student health clinics and telehealth than standard plans.
- Offers an array of convenient and useful tools: For students, United’s convenient web-based cost-estimating tool, payment portal, mobile app, and provider search tool can tip the scales in its favor.
- Plans may be state-specific: You may not be able to find all the coverage you want or need in a United plan in your state.
What is Medicaid, and Can College Students Get it?
Medicaid is a federal program that provides free or low-cost healthcare coverage to low-income adults and children, the elderly, pregnant people, and those with disabilities. Currently, 70.6 million Americans are covered by Medicaid.
College students can qualify for Medicaid, but you can only qualify if your household income is less than either 133% or 138% (depending on your state) of the federal poverty level.
Your state may offer coverage to other eligible groups, such as children in foster care or those receiving home- or community-based services.
Can My Student Health Insurance Refuse to Pay for Things?
When you obtain doctor-recommended treatment or medication, a claim is filed with your insurer. By law, the insurer must review your insurance claim and either approve or reject it within a reasonable time frame.
Occasionally, the insurer may refuse to pay the claim for several reasons, including lack of proven effectiveness of the treatment, the claim not being filed promptly, or the treatment not being deemed medically necessary.
What Do I Do If My Insurance Refuses to Pay for a Medical Treatment?
By law, you have the right to appeal the insurer’s decision and have the appeal reviewed internally by the insurer or externally by a third party. If the claim is urgent, they’re required to do so quickly.
The insurance company will send a letter with details about why the claim was refused, how and when to file an appeal, and whether consumer assistance is available where you live.
After you receive this letter, the appeal begins. There are three types of appeals.
- You or your doctor talks to the insurance company. This is the first step in the process, no matter what happens next. Your doctor could talk to a medical reviewer at the company to do a “peer to peer review,” in which they present an argument about why you should have been covered.
- If the process didn’t end at step one, a higher-up at the insurance company reviews the decision. This person can’t have been involved in the initial decision, and they’re determining if the claim was rejected incorrectly or unfairly.
- The external review usually happens after the previous two have been exhausted and the appeal hasn’t succeeded or when things have gone too far awry. An independent party and a doctor similar to yours assess what happened and if it can be rectified.
Depending on the claim’s size or the complexity of your case, you may decide to seek help from a legal professional in filing your appeal. Roughly 50% of appeals are successful.
If the appeal is refused, you may be able to file further appeals. It’s also important to know that an insurer can’t increase your rates or drop you from coverage if you appeal a claim decision.
If the denial of the claim is hindering your ability to pay your medical bills, work with the provider’s billing office. Explain that you’re in the process of appealing a denied claim with your insurer. They may put a hold on the invoice or allow you to pay a small amount and start a payment plan.
Also, know your rights:
- Medical debt is given less weight on your credit report than other debts.
- Medical debt can’t be reported to credit agencies until it is 180 days late.
- Medical debt is removed from your credit report as soon as it’s paid.
What Do I Do if I Can’t Afford Student Health Insurance?
It may be tempting to go without insurance if you’re a young, healthy student with bills to pay. But with medical debt being one of the leading causes of bankruptcy in the United States, the risks may not be worth the money saved by going without insurance.
Adults ages 15 to 19 may only comprise 7% of the population, but they make up 11% of motor vehicle injuries. Up to 15% of them suffer from chronic illness. And adults aged 18 to 25 have the highest rates of mental illness of all age groups.
You do have options if you can’t afford a monthly premium on full major medical insurance:
- Find out if you qualify for Medicaid or CHIP.
- Explore catastrophic insurance, which is the lowest-premium health insurance available. It’s designed for those under age 30 or who can demonstrate financial hardship. With a high deductible, it’s only intended to assist with extremely high medical expenses.
- Check into short-term insurance, which is designed to provide coverage for 30 days up to 12 months. Coverage can take place quickly and is usually less expensive than comprehensive plans.
- Consider employment with a company offering insurance. Some employers—for example, Starbucks, Lowe’s, Chipotle, and UPS—provide valuable health coverage to part-time workers.