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You compared education. He reviewed the costs of on-campus housing. Even digested student meal plan prices.
But have you ever thought about how much your son or daughter’s dream school will charge for health insurance?
You may experience a shock.
Hawley Montgomery-Downs was thrilled when her daughter, Bryn Tronco, won a scholarship to the University of Southern California that pays half of her $63,000 annual tuition fee. But just as school began in August, he was stunned when he received a $3,000 bill from USC that covered both the student health insurance premium and a fee that gave students access to on-campus clinics and other services. At her home in West Virginia, she had made no payments for her daughter’s health insurance through the state’s Child Health Insurance Program, which caters to lower- and middle-class families.
Montgomery-Downs, who lives in Morgantown, West Virginia, was particularly upset that USC billed him not only for health insurance, but also an annual medical fee of $1,050. “It would be fine for her to go to a student health center, but when I buy insurance to go to a primary care facility, it feels like I’m paying twice,” she said.
Mandatory health insurance and health care fees are common in colleges as a condition of enrollment, said Stephen Beckley, the college’s health and welfare counselor, of Fort Collins, Colorado. While the medical fee can help lower students’ insurance premiums, parents can feel like they’re paying double. “This is a huge enigma for our field,” he said.
For parents, these huge payouts can come as a surprise and make a barely affordable education feel even less. After all, students can save money by choosing a skimpy meal plan and cooking their own meals or buying used textbooks, but there’s no way to avoid mandatory health fees.
Costs vary by school, but can often reach several thousand dollars a year—costs that health advocates say need to be carefully reviewed by parents and students to ensure they understand their options when meeting college requirements.
Students can request a waiver of university health insurance by showing that they have their own insurance or that they are covered by their parents’ insurance that meets certain university criteria. Schools typically want to see a student’s own insurance cover local doctors and hospitals at little out-of-pocket cost. However, student medical fees generally cannot be waived.
A private college, USC charges $2,273 per year for its Aetna student health insurance plan. According to a 2022 survey by Beckley’s firm, Hodgkins Beckley & Lyon, the average is $2,712 for public colleges and $3,540 for private universities.
Other leading colleges charge much more, such as $6,768 at Stanford and $4,163 at Dartmouth College.
The University of Montana costs $4,700 and most services at the school health clinic are fully covered by the health plan. The University of Colorado charges $3,976.
At Harvard, students who purchase the school’s insurance pay $4,080 annually and $1,304 for student medical fees.
The easiest solution to avoiding these costs is for students to stick with a parent’s health policy – the Affordable Care Act allows this until they turn 26. – network coverage where the college is located.
Before leaving her home in Morgantown, West Virginia, and enrolling at the University of Southern California, Bryn Tronco’s health insurance was free under a government program called the Child Health Insurance Program.
Otherwise, parents may want to shop through ACA marketplace plans to see if they can find a bargain. If their income is low enough, students can sometimes enroll in Medicaid or a CHIP plan in the states where they attend school. However, this strategy also has limitations. Students must meet state residency requirements where they attend school, and parents cannot claim them dependent on their tax returns. CHIP coverage also ends when a student turns 19.
Schools that charge a student health fee and require insurance coverage say the fund helps cover services at campus health clinics that would otherwise cost students hundreds of dollars or more per year.
The USC student health fee, which covers primary and preventive health care, also helps the school pay for services not usually covered by insurance, such as monitoring for disease outbreaks on campus.
USC Student Health’s chief medical officer, Dr. Sarah Van Orman noted that the student health fee provides funding for additional mental health providers on campus and a team focused on sexual assault prevention and education – these services are available to students without any upfront payment. He said these additions are vital because, even with insurance, students may face difficulties in finding a private advisor who will provide timely assistance, and if they do so, students will have cost-sharing expenses.
“The student health fee supports our public health infrastructure on campus,” said Van Orman.
Because students can get primary care at the student health center on campus, fewer are seeking insurance-paid care, which helps keep the monthly premium on the Aetna student health insurance plan lower, she said. “They work together and are by no means the same,” said Van Orman.
USC’s student health insurance has an in-network annual waiver of $450 and an additional charge of $20 for doctor’s office visits. It also offers comprehensive nationwide services so students are covered while they are at school and when they return home – even if they are nationwide. About half of USC students buy Aetna student insurance, according to Van Orman.
Other colleges have a different strategy. For example, George Washington University’s compulsory health insurance covers campus health center services. Unless they receive an exemption, undergraduates must enroll in the student health insurance plan (which costs $2,700 per year) unless they can prove they have another insurance plan that meets the school’s criteria. The health plan premium allows students to receive many free services at the student health center, including medical office visits, certain prescriptions, and routine screenings for sexually transmitted infections.
Beckley said college rules vary on whether or not students allow students to choose insurance plans other than those the school offers.
USC, a private college attended by Hawley Montgomery-Downs’ daughter Bryn, charges $2,273 per year for its Aetna student health insurance plan. According to a 2022 survey by Hodgkins Beckley & Lyon, a benefits consultancy, the average is $2,712 for public colleges and $3,540 for private universities. “It’s not something we budget for,” says Montgomery-Downs for healthcare costs.
USC allows students to purchase an alternative insurance policy through their parent’s plan or in the ACA market, as long as they meet the school’s requirements that cover comprehensive health insurance in the Los Angeles area and zero cost-sharing and preventive care. Out-of-state Medicaid or CHIP plans do not meet the university’s criteria as California does not have provider networks for routine care.
This was unwelcome news for the Montgomery-Downs.
“It’s not something we’re budgeting for,” he said of USC’s healthcare costs.
Montgomery-Downs, a former associate professor at West Virginia University and now a freelance editor, said he wasn’t sure what to do when USC got its medical bill. Bryn, who turned 19 this week, initially thought she would be covered by insurance, as her CHIP plan provides treatment coverage in out-of-state emergency rooms and emergency care centers. And Montgomery-Downs wanted to ensure that her daughter had health insurance for the summer and vacation vacations while she was home.
Unsure which market coverage options would meet the school’s rules and deadlines, she decided to opt for the Aetna student plan offered by USC.
A look at the marketplace options in Covered California shows that $2,200 is a competitive rate for the USC Aetna student plan. The lowest-priced comparable PPO plan offered by California Blue Cross that would provide Bryn with a national network of providers costs approximately $2,400 per year, taking into account a government subsidy based on family income. PPOs provide some coverage for out-of-network doctors and hospitals.
Montgomery-Downs has taken its toll on the market and said it will be shopping for a marketplace plan for Bryn for the next school year. She said she wished they were aware of all the health costs at the time of admission and not just before classes begin.
“Everything is a nightmare, even for someone who understands the privilege of time and those bureaucracies — higher education and health insurance,” Montgomery-Downs said.
Phil Galewitz is a senior reporter for Kaiser Health News, an independent program of the Kaiser Family Foundation where this story was originally published, covering Medicaid, Medicare, long-term care, hospitals and other government health topics. Email: [email protected] Twitter: @philgalewitz.
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