Affordable Health Insurance For College Students
The college years can be a stressful time for any student, but paying massive healthcare bills is one worry students shouldn't have on their plate. With the Affordable Care Act, students have more options than ever when it comes to finding affordable insurance.
Here are some paths to consider if you're attending school and looking for affordable coverage.
Stay on Your Parent's Plan
The Affordable Care Act (often referred to as ACA or ObamaCare) made it a little easier to join or remain on a parent's policy, which is often the least expensive option. Now, plans that cover dependents have to accept children until the age of 26. It may not cost your mom or dad anything extra to keep you on the plan, since some cover the entire family for a fixed price.
You can piggyback onto your parent's plan even if you're a student and no longer living at home – and you don't have to be a dependent for tax purposes, either. Things get a little more complicated if you attend an out-of-state institution, however. Depending on the plan, you'll want to check with the insurance carrier and make sure it has in-network providers near the school. Otherwise, your family could be paying a lot more if you need medical attention.
Consider a Student Health Plan
Many colleges offer their own health plans, which have key benefits over buying your own individual policy. Because you're buying as part of a group, the costs are generally much less expensive. In addition, you can often pay for premiums using your student loans, which is a definite plus for cash-strapped students.
One downside to these policies is that they're sometimes more restrictive than other forms of insurance in terms of what they cover. Therefore, it's a good idea to review your college's plan carefully before signing up.
Buy on Your State's Exchange
As a result of the ACA, each state has a health exchange, or marketplace, where private insurers offer standardized plans. One of the advantages of using the exchange is that you may qualify for income-based subsidies that can dramatically lower your insurance bill.
These subsidies are in the form of a tax credit, meaning you'll have to file a tax return to see if you qualify. So even if you don't make enough money to fill out a return otherwise, there's now a compelling reason to do so. When you're completing your application on the insurance exchange, select No when asked if you have health coverage – even if you're currently on your school's plan and intend to relinquish it.
Several states have also expanded Medicaid, which provides inexpensive health care to low-income residents. Filling out the marketplace application will tell you whether you're eligible for even more savings under this joint state and federal program. For more, see Tips On The Healthcare Marketplace/Exchange.
Obtain Catastrophic Coverage
In many cases, a student health plan or one sold on an exchange will offer decent coverage at an affordable price. However, students on a particularly tight budget sometimes opt for catastrophic coverage instead.
As the name implies, these bare-bones policies are designed to provide some relief if you experience a major medical complication. Plans sold on an exchange are open to people under 30 (and those with a hardship exemption) and cover three primary care visits a year. Beyond that, you pay your healthcare costs out-of-pocket until you reach the deductible, which can be over $6,000.
Keep in mind that catastrophic plans are always a gamble. If you're relatively healthy, you'll benefit from their low premiums. But if something unforeseen should arise, you'll probably wish you had something more comprehensive. For more on these plans, see Lowering Your Costs For Marketplace Health Insurance Coverage.
The Bottom Line
These days, there are plenty of alternatives for university-level students looking for reasonably priced health insurance. To get the best deal, it's worth comparing all the different options. Be sure to look at what they cover, not just price, when making your decision.