With the passage of President Barack Obama’s health-care reform bill, students at UCSD may soon see the cost of their school-sponsored health insurance program increase, along with an excise tax on tanning beds and full insurance subsidies for individuals with no income.
The bill — passed last month after more than a year of deliberation in Congress — allows students to remain on their parents’ health-insurance plans until they reach the age of 26 — a significant increase from the previously common age limits of 19 or 23. Before the bill’s passage, children were typically removed from their parents’ policies when they graduated from high school or college.
The provision is designed to cover the 1.7 million university students — or 20 percent of the national student population — who are currently uninsured.
According to Student Health Insurance Program Manager Cindy McDaniel, allowing students to stay on their parents’ plan until age 26 will likely raise the price of participating in UCSD’s health-care program.
McDaniel said that if more students are covered by their parents’ insurance — students who would otherwise have paid for basic coverage through the campus program — they will choose to opt out of S.H.I.P. Since the price of the S.H.I.P. plan depends on the number of students subscribed to the plan, an increase in students choosing to opt may lead to higher prices overall.
Currently, S.H.I.P. costs approximately $282 per quarter for undergraduates. According to McDaniel, it is still too early to estimate how much the prices would increase.
“A lot of factors go into the cost of student health-care plans,” she said. “Of course, the number of students enrolled will have an impact. It’s still too early to tell… but we’re still trying to work out a time frame [to determine the new rates] with our broker and insurance carrier.”
For Eleanor Roosevelt College freshman Danny Fishman, the reform means he will likely opt out of the program by next fall. Fishman said that, had the bill not passed, he would have been removed from his father’s insurance plan when he turned 19, and would have subsequently signed up for S.H.I.P. However, his plans have changed.
“If the price of S.H.I.P. increases while I’m still on my father’s plan, I’m going to stay on my father’s plan — there’s no need for me to get S.H.I.P. anymore,” he said.
The reform is particularly beneficial to students like Fishman who have undergone a medical procedure in the past. Fishman would have had a difficult time securing independent health insurance under the old system.
“I had a medical procedure done two years ago,” he said. “If I tried to apply to Kaiser as an independent — because of that prior medical history — I wouldn’t be accepted.”
The bill prohibited that anyone under 26 be denied coverage due to pre-existing conditions. In addition, a provision will go into effect on September 23, 2010, that prohibits insurance companies from dropping customers from their plan when they become sick.
According to Congressman Bob Filner (D-San Diego), who spoke at UCSD on April 6, the bill will also empower students whose parents do not have health insurance by making them a large demographic health care companies will listen to.
“If you’re a student and your parents don’t have an insurance plan, in a few years, you’ll be able to join a pool of uninsured people — and that gives you leverage as if you were a part of a big company,” Filner said.
He added that the “leverage” would make it more likely that major insurance companies offer lower rates.
Filner also said the health-care reform will provide students — and the general population — with a government subsidy, based on a person’s income.
“If you have zero income, you’ll get almost 100-percent subsidy,” Filner said.
When the bill goes into full effect in 2014, every American will be required to purchase a minimum health-insurance package, and will be fined anywhere from $750 to $1,000 if they do not comply.
In 2014, individuals with income levels at 133 percent of the poverty line — approximately $15,000— will be eligible for Medicaid, a government program providing health insurance for low-income families. In 2009, the average starting salary for new college graduates was $48,515.
Marshall College freshman Tiffany Lee said the threshold for government subsidies is too high.
“I’ve worked a minimum wage job as a waitress, and it wasn’t a lot of money,” Lee said. “Even with tips, you still lose a lot of your salary to taxes, and that would be hard to live off of. The bar for government-supplied insurance should be higher, since so many people make so little money.”
Effective July 2011, the health-care bill includes provisions that will create a 10-percent excise tax on the use of indoor tanning beds.
Muir College freshman
Julie Luu said the excise tax was a good idea.
“Tanning beds are a luxury,” Luu said. “Every little penny [to fund the health care bill] helps, so it’s probably a good idea because health care reform needs a lot of help and it’s a good start.” The bill also allows those who receive federal subsidies for health insurance to purchase abortion coverage for a surcharge.
Additional reporting by Ayelet Bitton.
Readers can contact Cheryl Hori at [email protected].
