Obamacare Gives College Students Sticker Shock

Monday, 18 Nov 2013 08:53 PM

By Cathy Burke

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Low-cost, bare-bones insurance plans for college students don't meet Obamacare standards, and many colleges have to choose whether to offer vastly higher-cost plans or cancel coverage altogether, reports say.

At Bowie State University in Maryland, the cost of student health insurance policies went from about $100 a year to $1,800 a year, Fox News reported Monday.

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The cancelled plans offered $5,000 worth of medical coverage to students for just $54 per semester; administrators said an acceptable replacement under the Affordable Care Act would have cost $900 per semester, according to the university's website.

In the end, the school decided to drop the policy for the 5,500 students who were enrolled, and college spokeswoman Cassandra Robinson said they'll find a better deal on the Maryland insurance exchange.

Students were furious.

"You haven't done anything, Obama, and I am disappointed in you," one told Campus Reform, while another fumed: "We don"t have that money. We can barely afford books."

In New Jersey, students who enrolled this past semester were the first to shoulder higher premium costs. Many community colleges in Bergen and Passaic counties were forced to cut student coverage altogether, North Jersey.com reported.

"This is an unintended consequence of the federal health care overhaul," Jake Farbman, of the New Jersey Council of County Colleges, told the website. "In an ideal world, we want students to have access to healthcare and also want them to have affordable education."

At Passaic County Community College, no-frills insurance had cost as little as $100 a year; new plans offer coverage for a range of services that some students likely needed but couldn't pay for — from annual checkups to HIV screening to alcohol abuse treatment — all with little or no co-pays and tightly capped annual deductibles, North Jersey.com reported.

With those added benefits, the annual cost of the policy offered this year to students at nine schools in the state rose to $1,050, three times what it was in the 2010-11 school year, said Paul Shelly, spokesman for the New Jersey Association of State Colleges and Universities.

It has been a similar story across most of the country.

According to a 2008 study by the Government Accountability Office, about 6,000 students, or about 7 percent of the total number of 18-to-23-year-olds in college, bought their own insurance, usually through plans arranged with the school, Fox News reported.

The same study found that 60 percent of schools' plans had coverage of $50,000 or less for specific conditions, and almost all the rest had some sort of payout caps that they will have to do away with by 2014.

Students at Bethany College in Lindsborg, Kan., were offered a one-year plan that cost students $445, with payouts capping at $10,000. For the 2012-13 academic year, the payout cap was increased to $100,000 under the new health care overhaul, which meant students at Bethany would have to shell out more than $2,000 for coverage.

Urgent: Do You Approve Or Disapprove of President Obama's Job Performance? Vote Now in Urgent Poll

Bob Schmoll, Bethany’s vice president for finance, told The Wall Street Journal that
the school "decided not to offer coverage for our students next year," given the proposed increase in premium. Schmoll said the school could have kept the limited-coverage plan but that it would have financially not been feasible.

Administrators at Lenoir-Rhyne University in North Carolina, Cornell College in Iowa and the University of Puget Sound in Washington also told students they would be dropping school-sponsored coverage. The three schools say student premiums would have gone up tenfold, The Journal reported.

Related Stories:

States Mixed on Support of Obamacare Fix
State Insurance Regulators Hesitate to Embrace Obamacare Fix

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