What You Need To Know About Student Health Insurance

By Pooja Dave AAA

College students have their fair share of worries, such as paying tuition fees, working out schedules and, of course, studying. With all this to deal with, it's not surprising that health insurance isn't the main thing on students' minds. In fact, according to a 2002 study sponsored by the Heinz Family Philanthropies and the Chickering Group, 30% of college students don't have any type of health insurance. The study also pointed out that the need for health insurance is hard to ignore, as those who were without it were less likely to complete college. In this article we will look at the advantages of having a good student health insurance plan. (For more information on the types of healthcare plans available, read How To Choose A Healthcare Plan.)

But Don't I Already Have Coverage?
Students are normally provided with standard student medical insurance by the university or are still covered under their parents' plans, but many times, pre-existing conditions make it difficult for a student to get the appropriate coverage through college insurance, which may be "bare-bones" and not cover specific conditions. For instance, a student suffering from asthma may find that this condition is not covered by his or her school. In this situation, a student health insurance plan from a private healthcare provider may be worth looking into.

Many health insurance companies cover full-time students under their parents' insurance plans. However, the student has to be of the specified age, typically between 19-24 years, for this coverage to be available. In addition, if the student is studying at an out-of-state school, he or she may be out of the insurer's coverage area and won't be covered under the plan.

Occasionally, colleges demand that students have some form of insurance before starting the school term. But even if it is not required, it is important to have some form of health insurance, as a large hospital bill is the last thing a student needs to have to consider. (For more information on how to handle expensive medical bills, read 20 Ways To Save On Medical Bills.)

While you can simply purchase a regular healthcare plan, there are some student-specific plans that may better cater to the needs of this age group.

College Student Health Insurance Plan
To purchase this insurance, you need to be an undergraduate under the age of 30 with a minimum of six or nine credit hours. The eligibility criteria may vary from one state to another. Graduate students are also covered as long as they qualify as full-time graduate students registered in a state-recognized college or university. The major benefit of this type of plan is that you are at liberty to choose any licensed doctor or hospital during a medical emergency.

The plan provides yearly protection throughout the U.S., with the premium to be paid on an annual or semiannual basis. Coverage under this health insurance plan becomes effective almost immediately. Generally, the maximum amount permissible per illness or injury is $100,000, and the lifetime insurance protection is $1 million. However, it is always prudent to check the maximum amount permitted for specific benefits as well. These will be described in your insurance policy.

Expenses covered by this plan include intensive care, outpatient and inpatient surgery, inpatient prescription drugs, hospital boarding expenses, and pre-existing conditions coverage after a 12-month period. Maternity benefits are not covered under this policy, but many insurers do provide complicated-pregnancy coverage.

Under this health plan, a calendar-year deductible and co-insurance are applicable:

  • A calendar-year deductible is an annual deductible that you have to pay before your health insurer starts paying the benefits as per the plan. The higher the deductible, the lower your monthly premium, and vice versa. A higher deductible means that extra money has to be shelled out from your own pocket annually for medical costs. So, if you have a $250 deductible and you receive a medical bill amounting to $500, you are obligated to pay the first $250 of this bill.

  • Co-insurance is the amount your policy will reimburse after you have paid your annual deductible. Normally, the co-insurance ratio comes to around 80/20; the insurer pays 80% of the medical expenses, leaving you liable for 20%. For instance, suppose that your medical bill comes to $150. Assuming that you have already paid your annual deductible, your insurance plan pays $120, leaving you with $30 to pay.

A student health insurance plan is renewable even after you leave college. Exclusions under this policy generally include pre-existing conditions, pregnancy, dependent coverage, sports injuries, mental disorder, substance abuse, and dental and vision coverage.

Health insurance companies do provide maternity benefits and other benefits such as alcohol and drug rehabilitation, and psychiatric treatment -
for an extra charge. These benefits may differ between states.

Short-Term Health Insurance Plan
As the name suggests, this type of insurance plan provides short-term health insurance coverage to students for a period of one to six months or for the whole year. The premiums are to be paid either in a single lump sum or in installments.

Here too, students may receive treatment from any licensed doctor or healthcare facility. The maximum lifetime coverage allowed under this type of plan is generally $1 million. Benefits can include surgery, ambulance and doctor diagnosis services, outpatient and in-hospital treatment, intensive care, and X-ray and laboratory costs. Of course, this will all depend on the exact plan and the insurer. Short-term health insurance is a non-renewable plan and may not be available in all states.

Deductibles and co-insurance are also applicable. In view of that, you have to first pay your deductible, after which the co-insurance option of 80/20 or 50/50, as specified in the policy, takes effect.

For students, this is often a great choice in terms of insurance because it provides the necessary coverage and is usually the cheapest available option due to the short-term nature of the coverage.

Studying Abroad
For students studying outside the U.S, typical student health insurance may not be available. In this case, students need short-term or long-term overseas student health insurance, depending on the duration of their stay in another country.

Nevertheless, there are many health insurers that provide renewable comprehensive medical insurance for students studying abroad.

Conclusion
Insurance protection while attending school is recommended, owing to the possibility of accidents and illnesses. However, the main concern is having the right type of health insurance coverage. When juggling high tuition costs and living expenses, the last thing students need is a large medical bill they can't pay. Research the types of coverage available carefully and choose one that best fits your health needs. If you're lucky, you'll never have to file a claim, but injury and illness are often unexpected - if you're well insured, at least you'll know you've got it covered.

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