Colleges say new health law may imperil student policies
by admin on Sep.04, 2010, under Home insurance
Colleges and universities say that some rules in the new health law could keep them from offering low-cost, limited-benefit student insurance policies, and they’re seeking federal authority to continue offering them.
Their request drew fire from critics, however, who say that student health plans should be held to the same standards that other insurance is.
Among other things, the colleges want clarification that they won’t have to offer the policies to non-students.
Without a number of changes, it may be impossible to continue to offer student health plans, says a letter that the American Council on Education sent Aug. 12 to Health and Human Services Secretary Kathleen Sebelius, signed by 12 other trade associations that represent colleges.
Additionally, the colleges say that some provisions of the law don’t apply to their policies, including those that require insurers to spend at least 80 percent of their revenue on medical care and that bar them from setting annual coverage caps.
Many of the provisions at issue don’t go into effect until 2014, but the colleges say they need clarity soon because they’re negotiating long-term contracts with insurers now.
HHS spokeswoman Jessica Santillo said Sebelius had received the letter and “looks forward to sending a response.” Santillo added that the health care law allows many young adults to stay on parents’ policies until age 26.
The request comes amid continued scrutiny of student health plans, including an ongoing investigation by New York Attorney General Andrew Cuomo, who said in April that some of the plans left students “at risk while providing massive profits for insurance companies.”
His investigation has found that policies offered to New York students were inexpensive, ranging from as little as $100 a school year to more than $2,500, but that the benefits also vary widely, with some capping annual coverage at $25,000 or setting per-illness caps as low as $700.
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