August 28, 2012

Meeting Obamacare Requirements, Cornell Increases Coverage, Cost of Health Plan

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This semester, Cornell released its most comprehensive student health insurance plan yet –– a policy that will expand coverage while raising the cost of insurance, according to officials from Gannett Health Services.

The changes make the University’s Student Health Insurance Plan fully compliant with the coverage required by President Barack Obama’s Affordable Care Act, which represents the most significant overhaul of the nation’s healthcare system since Medicare and Medicaid in 1965. The ACA, which aims to reduce the cost of healthcare, requires all health insurance plans to meet its requirements by 2014.

The changes to Cornell’s updated health care plan affects the 11,000 Cornell students — more than half the student population — enrolled in SHIP.

The new plan, approved in April, is more comprehensive than previous plans. It provides preventive care without a co-pay, whether that Cornell student studies in Ithaca or at another campus; no limit to the amount one can spend on prescription drugs; and there is no annual ceiling on the amount of money covered on health care services, according to Valerie Lyon M.H.A. ’91, associate director for business and finance for Gannett.

Lyon said these are major additions to the previous health insurance plan, which had provided only limited preventive services to Ithaca-based students; capped prescription expenditures at $4,000; and had a $1 million annual ceiling.

The new plan, however, is more expensive than previous plans. It is priced at $1,998 –– representing a $100, or 5.3 percent, markup from last year. The rates for dental and eye care, which are optional add-ons to the health plan, were unchanged.

Lyon said the increase in premium cost is reasonable given the quality and breadth of the insurance plan’s services. The plan would cost about $8,000 if it were sold on the market, she said.

“The fact that 11,000 students are enrolled means we can offer a very cost-effective plan,” Lyon said.

Given that the ACA requires health providers to implement its guidelines by 2014, SHIP’s premium hike was unavoidable, according to John Rhee ’12, a former member of the Student Insurance Advisory Commitee — which meets annually to review the health plan.

“Other universities are also adjusting [prices] similarly to fall in line with ACA regulations by 2014,” Rhee said.

Heather Fullerton grad, also a former member of SIAC, said that the new plan will reduce prescription costs for students. She added that, for many graduate students, the value of extending benefits to same-sex partners outweighs the five-percent increase in the cost of the plan.

Due to the passage of ACA, changes may also be coming to the students not enrolled in Cornell’s health insurance plan. Under the ACA, dependents will be able to stay on their parents’ health insurance plan until they are 26 years old, according to Lyon.

Still, Lyon said that with the ACA, many employers are shifting more health care costs to their employees, meaning health care for students on their parents’ plans could get more expensive.

Because of their insurance plans, some students must pay deductibles of more than $1,000 for services at Gannett. Additionally, many students’ plans “have limited coverage in the Ithaca area,” according to Lyon.

Sharon Dittman, associate director for community relations for Gannett Health Services, said that she believes students are pleased with the changes so far.

“Neither Gannett Health Services nor the Cornell University Office of Student Health insurance has experienced pushback related to the premium increase,” Dittman said.

However, Rhee said SHIP’s cost increase — albeit small — could become problematic in the future.

“I think that [these changes] can be difficult for some students financially,” Rhee said. “The University should think of ways to invest in financially supporting students who may have difficulty paying for health insurance, especially if they cannot be covered by their parent’s insurance.”

Correction: A previous version of this story inaccurately reported that the old Student Health Insurance Plan did not allow one to enroll students’ same-sex partners. In fact, same-sex partners have been eligible to enroll in SHIP for many years. This year, however, all domestic partners, regardless of gender, are eligible to enroll.

Original Author: Erin Ellis