Is Your Kid Covered?

[RedEarth]

Insurers make big profits from college students, but some families are left with huge bills
by Ben Elgin and Jessica Silver-Greenberg
BusinessWeek
May 8, 2008

In fall 2006, Ralph Giunta Sr. decided to buy his son Ralph Jr. a practical birthday gift: health insurance. The father, who owns a small financial-services company that lacks an insurance plan, phoned Palm Beach Community College, where his son was on the dean’s list. The Lake Worth (Fla.) school recommended a policy provided by MEGA Life and Health Insurance, whose student business was acquired in late 2006 by giant UnitedHealthcare. Giunta wrote a check for $1,044 for one year. “They assured me he was well covered,” he says.

Six out of 10 colleges and universities now recommend specific health insurance plans for their students, and three of 10 require them. But as the Giuntas discovered, many of the policies turn out to be scanty at best, and inferior to comparably priced alternatives. This can leave families exposed to crippling medical bills they thought they’d protected against. Insurers, meanwhile, have found that the student market can be quite profitable.

Ralph Giunta Jr. knew something was wrong in March, 2007, when the photography major and avid skateboarder felt pain in his legs and feet. Then 19, he lost all feeling in his lower extremities and was rushed to the hospital. The diagnosis: Guillain-Barré’s syndrome, a rare disease of the nervous system that typically causes temporary paralysis. His father’s anxiety was compounded upon learning more about the insurance he had purchased. Even with “major medical” coverage, the plan reimbursed only $22,800 of the $206,325 bill for 19 days of intensive care.

In the end, Ralph Jr. recovered, but the Giuntas owed $265,000 in hospital and doctor bills. As he juggles maxed-out credit cards and loans from friends to make minimum payments on medical debts, Ralph Sr. admits he didn’t read the UnitedHealthcare plan closely. “I thought, well, the college is offering it,” he says. “Why would it be a bad plan?”

More than half of the insurance plans recommended by colleges offer benefits of $30,000 or less, according to a survey published in March by the General Accounting Office, an arm of Congress. Many plans have further limits that prevent payout of even modest maximums. While two-thirds of the country’s more than 17 million college students have coverage from a parent’s employer or their own job, many of the rest may be vulnerable if they suffer a serious illness or accident. With premiums and restrictions increasing under employer-provided plans, a growing number of parents are shifting children to college-sponsored coverage. But “when a student gets gravely sick, $30,000 in benefits is unrealistically low,” says Alan Sager, a professor at Boston University’s School of Public Health.

http://www.pnhp.org/news/2008/may/is_your_kid_covered.php

[proud2BlibKansan]

1. My kids in their 20s who are not full time students have nothing

So at least this kid has more than my kids have.

But damn, when will we wise up and insist on universal health care?

[Raejeanowl]

2. Our Youngest Is A "No," And I Bet This Story's Typical

The not-quite-21-year-old daughter we have living at home would have been eligible to stay on our "family" plan until at least age 22 and possibly until 25 had she remained a full-time student (12+ credit hours per semester). However, she elected to change that last September. Since then, she has been diddling around indecisively with various trivial employers-including the current one-who, while they are happy to schedule her up to full-time hours, are reluctant to officially designate her as a full-time employee, thereby incurring an obligation to offer the health benefits available to their other full-timers.

Daughter has been "going naked" for nine months, and balks at the 150 to 200 per month (and more) she has been quoted for a mediocre HMO(!!!)plan. She has no history of major problems or pre-existing conditions to justify those rates. Now she is delaying routine preventive doctor visits.

Dad and I are reluctant to underwrite any larger a share of her expenses than we already do, and are frustrated trying to expedite a resolution whereby she accepts responsibility for herself. But in the meanwhile, I do not sleep well thinking about the possible financial consequences of a catastrophic accident or illness, or the impediments that might be raised in obtaining treatment, all due to a lack of insurance coverage.

[Fire_Medic_Dave]

3. 150 a month

She balks at that. She needs a wake up call.

[MountainLaurel]

5. No kidding. I pay more than twice that

To insure Mr. Laurel and myself, and that is considered a steal deal.

[Celebration]

4. Ugh-- just a suggestion

Make her getting coverage a condition of her living in your house. If you can afford it, offer to pay a portion of it. Any coverage is better than none--the problem is if she gets any sort of health condition. With current coverage, she could be immediately covered by an employer. Otherwise, there would be a long waiting period.

You would sleep better an night.