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Tuition…Room and Board…Linens…Healthcare?

It’s time. Your child’s tuition bill has arrived. If it’s the first child you’ve sent off to college, it’s shocking. Even if he or she is a returning student, it’s still shocking. Most of the time, your child’s health care isn’t your first concern, especially if your children have been covered under your or your spouse’s health insurance and can be covered until age 26.

It’s time to take a look at college health care plans and see what the Affordable Care Act (ACA) has done to make them more attractive. In the past, most plans that were offered to students by colleges and universities were restricted in what was covered, and the annual benefit limited coverage. The ACA has changed that: more coverage, but at a price. Given that August is often when the college year begins, and given that open enrollment for benefits begins on October 1st, now is the time to evaluate the healthcare choices for your children.

What did the ACA do to improve the coverage provided by the plans offered by colleges? Beginning with this academic year 2013-2014, the maximum annual benefit will increase from $100,000 to $500,000. And the following year, these plans will be required to adhere to the same regulations as standard health insurance plans that include essential health benefits and preventative services, among others.

College plans certainly offer more comprehensive coverage than in the past, however the price tag reflects the increase in benefits. Last year, the cost of the average college health plan increased by more than 9%. Most parents will continue to cover their children on their own family plan through age 26, yet their health insurance costs will also increase, and so it does make sense to review a college’s plan.

What should parents do?

First and foremost, be sure that your child has health insurance. Although students are young and healthy, insurance claims are frequently injury related or associated with something other than illness. Most private colleges require that a student have health insurance, but not all state schools do. Nonetheless, it’s important.

Next, be aware that Health Insurance Exchanges (HIX) will open on October 1st. In most states, the insurance companies and plans are not yet clearly defined, however, one plan will most likely be a catastrophic plan for adults under age 30. It may not make the academic year deadline, but it is worth looking at in the event that coverage can be amended by semester.

Look closely at your own coverage. Employer sponsored health care can change annually and you want to make certain that the coverage is adequate for your student. If a college is a distance away, it may be difficult to find doctors and hospitals that accept your insurance. One additional consideration is where there is a teaching hospital associated with a college. These hospitals may have health insurance plans specifically for those students.

Sharpen your pencil or set up your spreadsheet for this academic year for your health insurance considerations. For additional information, contact EAB HealthWorks.