October 4, 2010

CornellCare in an ObamaCare World

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Sept. 23 was a benchmark date for health care reform in our country. Major provisions of the Patient Protection and Affordable Care Act took effect, including extended coverage for young adults and major consumer protections. There wasn’t much change on the Cornell campus however, as Cornell’s Student Health Insurance Plan is exempt from the protections and has already enrolled students who are otherwise not covered under their parent’s plans. Given the new law and the historical lack of quality associated with student health insurance plans, it is important to focus on whether CornellCare is a viable substitute for ObamaCare.Cornell students are automatically enrolled in the Student Health Insurance Plan unless they complete a waiver with proof of acceptable insurance. The University touts SHIP as a “high quality and competitively priced” plan that covers students on campus, at home and abroad. Managed by national insurer Aetna Student Health and costing $1,716 per student per year, it reportedly provides extensive coverage, covers pre-existing conditions, helps defray catastrophic expenses and covers both inpatient and outpatient medical care in the Ithaca area.The quality of this care seems to be more than sufficient. According to The Wall Street Journal, “Good insurance plans are marked by … benefit ceilings of at least $250,000, generous prescription drug plans and emergency room coverage.” SHIP has a maximum benefit of $1,000,000 per policy year and includes both prescription and mental health services.Cost, however, is another concern. At almost $2,000 per academic year, SHIP is a considerable expense for students living on a budget. The quality of the plan far exceeds that of other student health plans, but so does the cost. Student Assembly Minority Representative Roneal Desai ’13 has made a concentrated effort to address this. One of his goals is to create a program whereby students in the top-five percent of those receiving financial aid would receive a $700 grant to subsidize the cost of SHIP. Unfortunately, the difficulty of finding a source of funding has been a major hurdle, but Desai plans on working toward a resolution next semester. Until then, students are without a paddle in paying for SHIP. I also want to investigate SHIP’s profitability. An insurance policy’s “loss ratio” is the percentage of premiums that go into health care; in other words, what percentage of fees students are actually receiving in care. Cornell has not provided loss-ratio information for SHIP on its website, but an investigation conducted by New York Attorney General Andrew Cuomo this past April found that “many student plans payout far too little in claims compared to the premiums charged to the students, in some cases paying out less than 30 cents for each dollar in premium.” In fact, Aetna Student Health agreed to pay out more than $5 million-plus in taxes and penalties for claims involving out-of-network care to 73,000 students nationwide, including Cornellians, after an investigation by Cuomo’s office in 2009. Student health plans are known to have high profit margins for insurance companies. Aetna should by all means be making a profit off the plans, but I am left wondering how much they do make and at what expense to students.Student health plans are exempt from the recent federal health care legislation because they are not classified as either group or individual plans. In other words, successful lobbying on the part of American College Health Association has ensured that student health plans will likely be able to continue to avoid new regulations on such factors as loss ratios and benefits. I find this a little unsettling and you should too. If a health plan is marketed as being on par or better than what is offered, it should at least match the same federal standards. If other insurance providers have to be accountable and comply with new regulations, it stands to reason college health plans should as well.The question then becomes whether SHIP is necessary in light of extended coverage for young adults under our parent’s plans. With the new federal law, we can stay on our parent’s health insurance until we turn 26. You don’t need to live with your parents or even file the same tax returns in order to qualify. We may already be committed to SHIP for this year (the waiver deadline has passed), but come August many students and parents may find it makes more sense to opt out of SHIP and instead use existing coverage. Even for those who were already covered under their parent’s plans and otherwise chose to enroll in SHIP, health care reform should serve as a wake-up call.Every student has to do their homework, myself included. When it comes time to decide what insurance coverage is best for you, it is important to research whether your family insurance plan provides sufficient inpatient and outpatient care in the Ithaca area. On this note, know that all students can use Gannett regardless of whether they are enrolled in SHIP. You should also look into whether there are benefits to plan ownership and compare premiums and benefits. The best plan for you depends on your particular circumstances; for example, those of us who suffer from the occasional acne outbreak need to make sure a plan covers the relevant (expensive) prescriptions. I also recognize that insurance policies can be confusing and advertisements from providers can be misleading, but this is no excuse not to give the issue due diligence. After all, $1,716 isn’t pocket change. That money can be valuable to you if your parent’s plan is sufficient (for instance, $260 could be allocated toward my incredible Section B, row 8 hockey tickets … just putting it out there, mom.)The important thing to know is that, with the passage of ObamaCare, you have a choice when it comes to health care. CornellCare may very well be exempt from many of the new legislation’s protections, but Cornell cannot exempt you from taking advantage of your parent’s health plan if it so benefits you. Whether SHIP is a service to the student body, a profit-making enterprise for Aetna or both is a matter of opinion, but the best health care choice for you should be a matter of fact. Jon Weinberg is a sophomore in the School of Industrial and Labor Relations. He may be reached at jweinberg@cornellsun.com. In Focus typically appears alternate Thursdays this semester.

Original Author: Jon Weinberg