AgileHealthInsurance Report | 2017-06-20
Affordability problems observed while colleges continue on trend to eliminate health plan offerings
With summer now upon us, maintaining affordable health insurance is a major concern for college students who lack year-round coverage through their school or coverage under their parents’ health plan. Likewise, recent college graduates without a job can face a similar predicament. In the interests of determining the extent to which affordable coverage is a challenge for college students and grads this time of year, AgileHealthInsurance performed a nationwide poll. The poll asked, “For any college students or recent grads in your family, is finding affordable health insurance a challenge?" Respondents had the option of selecting one of the following answers: “Yes, high premiums make it hard,” “Yes, high out-of-pocket costs make it hard,” “Yes, it is hard to find for other reasons,” “No, finding affordable insurance isn't hard,” or “My family doesn’t have a student or grad.”
Of those respondents with a college student or recent graduate in the family, 72 percent indicated that finding affordable coverage was difficult. Premiums were the most common impediment to affordability with 40 percent of student/graduate families answering “Yes, high premiums make it hard.” Half as many (20 percent) attributed affordability problems to high out-of-pocket costs. Another 12 percent of the student/graduate families had other unspecified reasons that health insurance affordability was a problem. “These ‘unspecified problems’ can include an ineligibility for premium subsidies on exchange health plans due to the student’s tax return status,” notes John Fees, co-founder of GradGuard, an authority on protecting the investment of college students and their families. “If a student is claimed by his or her parents as a dependent then the parents’ household income, including but limited to the student’s income, decides the student’s eligibility for premium subsidies under the Affordable Care Act.”
Students and recent graduates who encounter affordability problems with health insurance may possibly be at increased risk canceling coverage. A June 2017 government study of enrollees on Affordable Care Act (ACA) exchanges found that “consumers who canceled coverage prior to paying their first premium indicated that high costs and lack of affordability were the most common factors for canceling their coverage, or not paying the first month’s premium.” Unfortunately, the government study did not include data specific to college students or the millennial age group most commonly associated with college students.
With respect to the AgileHealthInsurance poll, not all college student/graduate families experienced problems with finding affordable health coverage. Almost three-out-of-ten (28 percent) indicated that finding affordable health insurance was not difficult for their students or recent graduates. For students under age 26 whose parents have health insurance coverage, there is the option to join their parents’ health plans. Additionally, students attending colleges where health coverage is required and paid for through a student fee may by able to use financial aid or a student loan to cover the fee. However, paying for health insurance with a student loan is not recommended since the student will pay interest on the health plan costs for years until the loan is repaid.
It should be noted in this context that student health plans are not as popular as they were prior to the Affordable Care Act. Since ACA premium subsidies are unavailable for student health plans and students may remain on their parents’ health plan until age 26, some colleges have chosen to discontinue their student health coverage options. “Given the new environment for student health plans under the Affordable Care Act,” said John Fees, “colleges and universities were left to ask themselves whether it was easier to direct uninsured students to an exchange rather than assume the hassle and costs of providing coverage themselves.”
According to AgileHealthInsurance’s nationwide survey, health insurance affordability is a challenge among the vast majority of college students and recent graduates. As documented within this report, students and recent graduates have considerations around health insurance that are often absent in other populations. Moreover, the high cost of college tuition united with decreased time for employment can exert considerable economic stress on this population and may tempt some students to see health coverage as nonessential luxury. “Students ineligible for exchange subsidies and are without coverage from college or parents,” John Fees observed, “need to be educated to investigate short-term health plans given their inexpensive price point, broad benefits, and wide doctor coverage. If we leave this group uneducated about their options, we increase their chances for going underinsured or uninsured.”
Results are based on 2,626 responses to a nationwide survey conducted from June 2, 2017, to June 4, 2017. The survey asked respondents, “For any college students or recent grads in your family, is finding affordable health insurance a challenge?" Respondents had the option of selecting one of the following answers: “Yes, high premiums make it hard,” “Yes, high out-of-pocket costs make it hard,” “Yes, it is hard to find for other reasons,” “No, finding affordable insurance isn't hard,” and “My family doesn’t have a student or grad.” The answer options were displayed in fixed order across respondents. Percentages in bar chart graphic based on only the 1,277 respondents who did not answer “My family doesn’t have a student or grad.”
The survey was displayed within a network of over 100 different news websites and other content sites. Demographic inferencing and methodology to acquire survey respondents who approximate national statistics on age, gender, income and region was performed by Google-administered technology. Race, education and health insurance status were not examined. Margin of error across all survey responses (including “My family doesn’t have a student or grad” is estimated at +1.7%/-1.8%.
This AgileHealthInsurance study was produced in collaboration with John Fees of Next Generation Insurance, an established expert on collegiate benefits.
 HealthCare.gov. “In school? Student health plans & other options.” https://www.healthcare.gov/young-adults/college-students/. Last accessed June 12, 2017.
 Centers for Medicare & Medicaid Services. “The Health Insurance Exchanges Trends Report: High Premiums and Disruptions in Coverage Lead to Decreased Enrollment in the Health Insurance Exchanges.” CMS.gov. (June 12, 2017). p.3. https://downloads.cms.gov/files/cost-disruptions-trends-report-06-12-17.pdf. Last accessed June 12, 2017.
 Donna Gordon Blankinship. “Concerns raised as colleges stop selling health insurance.” Boston Globe. (March 2015). https://www.bostonglobe.com/news/nation/2015/03/28/colleges-getting-out-health-insurance-business/S7ICpIeATy704plP3WNX8L/story.html. Last accessed June 12, 2017.