Students at the University of California are calling for an end to the caps that are currently part of the student health insurance plans offered by the university. The Affordable Care Act does not require self-funded plans to adhere to the health reform law’s requirements. This could leave students who have a serious medical issue paying for their care out of pocket.
In the news this week, there are many articles discussing the problems that students who attend self-funded universities could be facing due to their inadequate student health insurance. This is definitely an issue to look into if you are the parent of college student (or a student yourself) that is covered by the student health plan that comes from your university.
In the past, some health insurance plans (including student health plans) came with a cap. The cap was a limitation in the form of a dollar amount that an insurance company would cover for the policyholder in a given year (or in a lifetime). Once a person reached that cap they would have no option other than to pay out of pocket for whatever amount of health care they required.
The Affordable Care Act changed things. As of July 1, 2012, student health policies had to cover costs of up to $100,000 of expenses annually. By the Fall of 2012, those plans had to cover $500,000 of expenses annually. In 2014, student health plans will be prohibited from imposing a cap.
Unfortunately, this part of the Affordable Care Act doesn’t actually require all student health plans to comply with that part of the health reform law. Universities that are self-funded are exempt from it. This could leave students who require cancer treatment, or treatment for a serious or chronic illness, with a lot of unpaid medical debt.
Thousands of students at the University of California are demanding that the university voluntarily lift its insurance caps. They have started a petition drive.
Most of the University of California’s 10 campuses limit coverage to $400,000 per year. Students who attend UCLA pay more for a student health plan that comes with a cap of $600,000. Graduate students at UC San Diego pay even more, for a health plan that still comes with a cap (of $750,000). There are student health plans that can come with a cap as low as $10,000.
Dr. Flavio Casoy is the chief resident for psychiatry at San Francisco General Hospital, which is part of UC. His patients are not likely to hit the coverage limitations. However, Dr. Casoy feels that the coverage limitations in UC student health plans are not appropriate. He said:
… it shouldn’t be that UC exposes them to bankruptcy, incomplete treatment or death. It’s just wrong.
Who can predict when a normal bike accident results in a bad back injury, which has complications, and the person develops an infection, and so on. It’s astounding to me how unexpectedly these bad things happen and how wildly health care costs can spiral up.
Image by Phil Konstantin on Flickr