For UNC students covered by the school health insurance plan, Affordable Care Act provides unprecedented protection
BY: HANNAH EICHNER
Discussions of the Affordable Care Act (ACA), otherwise known as Obamacare, have largely centered around the exchanges where people can buy new insurance plans. However, the ACA provides added protection to everyone with health insurance, including students who are on the UNC System’s Student Health Insurance Plan. Now, UNC students can rest assured that if they have a serious illness or injury, their insurance won’t refuse to cover the treatment they need due to arbitrary spending caps, lack of coverage for organ transplants, or pre-existing condition exclusions.
Since 2010, the UNC system has mandated that all students have health insurance. Most students decide to stay on their parents’ plan, but more than 5,000 students at UNC-Chapel Hill are enrolled in a plan organized by the UNC System. UNC-Chapel Hill used to offer their own optional plan that had comprehensive coverage, but the UNC system plan that launched in 2010 had several elements that posed problems for people who developed serious illnesses or injuries, or who had pre-existing conditions.
Previously, the UNC System plan would not pay more than $100,000 a year per student. While $100,000 probably sounds astronomical to most college students, a severe illness or injury could easily hit that cap. For example, the University of Alabama puts the average cost of a spinal cord injury causing paraplegia (leg paralysis) at $508,904 for the first year after injury— more than five times UNC’s cap. As of this year, the ACA has eliminated the cap.
What would have happened if a student experienced a catastrophic illness or injury? Dr. Mary Covington, the executive director of UNC’s Campus Health, says that in the past, students with extensive medical costs might have found themselves in dire straits. “I’m not sure what would have happened,” she says. “People could have bake sales, or some sort of community event to raise money.” Of course, raising $400,000 through bake sales to pay for rehabilitation for a spinal cord injury is probably near impossible. In addition, dealing with a serious illness or injury is difficult enough without the added stress of trying to raise tremendous sums of money.
Thankfully, in the past few years no student on the UNC System’s plan has hit the $100,000 dollar cap. However, not hitting the cap was essentially a gamble. Students are typically healthy, so the odds of needing a high amount of medical care were very low. But the point of insurance isn’t really to cover everyday issues healthy people encounter; those could be paid for out of pocket for less than the cost of insurance. Instead, insurance is designed to insure people against the risk of higher medical expenses than they can pay for on their own. When the cap was in effect, it was essentially voiding the insurance for those with catastrophic illnesses and injuries—the very people who needed their insurance most.
Compared to other schools, the $100,000 cap was actually fairly robust. “In the history of student insurance plans, there have been other plans that had much lower limits,” Dr. Covington said. “Ten thousand, twenty thousand, forty thousand dollars.” Caps that low would have been even easier to hit, potentially after just a few days in the hospital. The ACA will also be a huge help to students at those schools.
Another previous limitation of the UNC System plan was that the policy stated there was “no organ transplant benefit.” Bone marrow transplants for blood diseases like leukemia were covered, but if a student needed something like a heart or a liver they were essentially out of luck. Even bake sales likely wouldn’t make a difference. According to a report by the Wall Street Journal, organ transplant centers typically require insurance coverage to qualify for an organ transplant, even if the patient is willing to pay out of pocket. As the argument goes, organs for transplant are a scarce resource. Therefore, hospitals have the responsibility to allocate them to those who will definitely be able to pay for a lifetime of expensive immunosuppressant medications. The ACA considers organ transplants an essential health benefit, so insurance plans (including the UNC System plan) must cover them.
The UNC System plan also used to pose an enormous problem for some students with pre-existing conditions. If a student had more than a 63-day gap in insurance before enrolling in the UNC plan, for the first year the insurance would not pay for anything related to a pre-existing condition. UNC Insurance Associate Sharon Moseley says that some students had the UNC insurance refuse to cover care because of this policy, particularly “students that had diabetes, and some students that were on and off of Medicaid.” Those students had to pay for their care (which probably wasn’t cheap) out-of-pocket, or go without. But, “of course, that doesn’t mean you couldn’t get coverage for any non-related issues,” Moseley said. Thanks to the Affordable Care Act, “all that went away on Jan. 1,” added UNC Insurance Associate Vicki Warwick.
Low costs for big results
Some people may worry that these additional protections pose an unsustainable financial burden on students. However, in the past year UNC System insurance premiums have actually gone down $42 a year, from $1,418 a year to $1,376 a year. In the same time period UNC switched insurance carriers from Pearce & Pearce to Blue Cross Blue Shield, so it is difficult to ascertain the exact effect of the plan changes on premiums, but it has clearly not caused premiums to skyrocket.
These changes are invisible to many. “I had no idea,” said Kescia Jo Hall, a sophomore who is on the student insurance plan. Most students are healthy, and probably don’t spend their time dwelling on what their insurance would pay for should something terrible happen. Thanks to the Affordable Care Act, though, they are covered if disaster strikes.
This article originally featured in Campus BluePrint’s March 2014 issue. For more content check out Campus BluePrint in print, available on campus and online!