The Ultimate Guide to Health Insurance for College Students

health-insurance-studentsWith youth comes a strong—if sometimes foolish—sense of invincibility.

Thus it’s understandable why most college students and young professionals don’t bother with health insurance. What many don’t realize, however, is that without health insurance, even one small mishap can lead to a serious financial burden.

What’s worse is that studies reveal that one in six young adults suffer from chronic diseases like asthma, diabetes, or cancer. Without sufficient health coverage, paying off medical bills can take its financial toll on anyone.

Health Insurance Options

Traditionally, young adults aged 19 to 25 years are the most likely to be uninsured in the United States. In 2012, however, the statistics finally bucked the trend, with the number of uninsured within the age group dropping from 48 to 41 percent.

It’s not that young adults have finally seen the error of their ways and started buying health insurance, though. Instead, the significant improvement is due to an increase in health insurance options for college students and young adults.

Under the Affordable Care Act, anyone below 26 years old—regardless of civil or educational status—can receive health insurance coverage from their parents’ health care plans. The act was signed into effect in 2010 and immediately addressed the “gap years” wherein college students and young professionals found themselves without health care because they were too old to be under their parents’ health insurance plan but too young and too broke to buy their own coverage.

Apart from relying on their parents’ health insurance, young adults have three other options for proper coverage:

  • Student Health Insurance. This health plan is offered to all full-time students enrolled in accredited universities and college. Unlike in school-sponsored student health insurance, this gives you coverage that will remain in place even if you cross state-lines for education. The only catch is that it’s usually more expensive than other forms of health insurance for young adults.
  • School-sponsored Insurance. Most schools offer health plans to their full-time students. You just have to visit your student resources office or visit your school website. The only problem is that your medical coverage is tied to your school. Medical services will commonly be provided within campus, and your health insurance coverage may falter if you become a part-time student. Also, graduating means you’ll have to find a different insurance option soon.
  • Private Insurance. Anyone who has the funds can buy insurance from private companies. Just make sure you pick an accredited and reliable insurance company to work with. Also, take time to understand the sort of coverage you’re getting. Most private insurance companies will charge extra for additional coverage.

Choosing the Right Health Plan

Given the many health insurance options, it can be quite confusing and difficult for college students and young professionals to choose the right health insurance plan. Here are a few factors to consider when choosing the right health coverage option for you:

  • Premium. Every month you have to pay a specified amount to your insurance company. This is called the premium. For many students, the premium is the deal-breaker, because you do have to make sure you can afford the monthly premium. However, there are other factors in play and to focus on the premium alone could be a bad decision in the long run.
  • Deductible. The “deductible” is the annual amount of medical expenses you have to cover before you ask the insurance company to step in. The larger your deductible, the smaller your monthly premium. This means you have to choose between making heftier monthly payments or ponying up a larger out-of-pocket cost in case of an emergency.
  • Co-insurance. Certain medical services will not be completely covered by your insurance company. A particularly expensive test, like an MRI, for example, will have the insurance company covering only 80% of the total expense. The patient will have to pay for the remaining 20%. The co-insurance is outside of the annual deductible.
  • Co-payment. Specific services—though covered by your insurance plan—may still require you to pay a definite amount upfront. For example, some insurance companies require co-payment for doctor’s appointments. It’s best to ask about co-payments before you sign anything, just to make sure you won’t have be overpaying when you avail of medical services.
  • Maximum out-of-pocket cost. This is a cap on your medical costs. Once you hit the maximum out-of-pocket amount (meaning the deductibles, co-insurance, and co-payment expenses combined), any other expenses for the year will be paid for by the insurance company.

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