Health Insurance for Texas College Students

1. Texas Department of Insurance Health Insurance for Texas College Students Presentation to the Senate Higher Education Subcommittee – April 23, 2008 Dianne Longley Director, Research and Analysis Life, Health and Licensing Texas Department of Insurance

2. Texas Department of Insurance TDI Study: Insurance Options for College Students in Texas: A Study of Student Health Insurance Plans • 2004-2005 study conducted as a part of TDI’s research on uninsured Texans • Funded by a federal State Planning Grant awarded to TDI in 2001-2006

3. Texas Department of Insurance What is Student Health Insurance? • Insurance products offered by commercial carriers that have contracted with a school to offer coverage to some or all students • Regulated as blanket accident and health insurance under Chapter 125 of the Texas Insurance Code • Is a group product, but not subject to the same provisions as employer-sponsored coverage • Ten carriers provide most of the coverage, and nine of the 10 are interested in expanding their coverage

4. Texas Department of Insurance Study Components • Discussion with school insurance coordinators • Survey of colleges and universities • Survey of students • Survey of health insurers

5. Texas Department of Insurance Uninsured Rates by Age - 2006 Source: US Census Bureau, March 2007 Current Population Survey (Texas Sample)

6. Texas Department of Insurance Reasons for the High Uninsured Rate Among Young Adults • Lose coverage under parents’ plan • Texas’ private insurance requirement of dependent coverage to age 25 applies only to fully-insured, regulated plans (2001 law) • No longer qualify for Medicaid / CHIP • Often work part-time, in low-wage positions, and/or for small employers; insurance coverage is often not available

7. Texas Department of Insurance College Students’ Insurance Status • National estimates: 25% to 33% of students are uninsured • 29% of part time students uninsured • 19% of full time students uninsured

8. Texas Department of Insurance Benefits of Health Insurance for College Students • Access to primary care • Provision of services for sexually active females • Mental health counseling • Nearly half of college students report problems of depression, eating disorders, alcohol abuse, stress, or suicidal thoughts • Coverage for accidental injury • Assists in developing a sense of responsibility and perception of the value and importance of health insurance

9. Texas Department of Insurance Injury-Related Emergency Room Visits per 10,000 Persons by Age and Gender, 2004-2005 Source: National Center for Health Statistics 2004, Table 84

10. Texas Department of Insurance TDI Survey of Colleges • August 2004 survey of all 142 institutions of higher education in Texas • Included public schools, private schools, community colleges and junior colleges from a list provided by the Texas Higher Education Coordinating Board • 100 responses were received over four months, representing schools with 83% of Texas college students

11. Texas Department of Insurance TDI Survey of Colleges (cont.)

12. Texas Department of Insurance College Requirements for Health Insurance • Texas law explicitly states that health-related institutions may require insurance coverage • Seven of nine have enacted requirements for all students • Two require coverage for medical students • Federal law requires coverage of international students with J-1 visas • 93% of schools require it of all international students

13. Texas Department of Insurance Percentage of Colleges with Insurance Coverage Requirements

14. Texas Department of Insurance Colleges that Offer Insurance

15. Texas Department of Insurance Reasons Schools Do Not Offer Insurance

16. Texas Department of Insurance Student Eligibility Requirements • Requirements vary by school • 70% of schools allow all students • Others have requirements for minimum enrollment hours • 90% allow dependent coverage

17. Texas Department of Insurance Costs for Coverage • Premiums in 2004-2005 ranged from $79 to $2,052 annually; the average premium was $718, and median was $835 • Health-related institutions: $1,044 • Public universities: $805 • Private colleges: $573 • Junior colleges: $319

18. Texas Department of Insurance Average Student-Only Annual Premium by Type of College

19. Texas Department of Insurance Annual Dependent Premium Costs • Premium costs are considerably higher for dependents, but competitive with the private market • Student and spouse: $2,897 • Student and child: $1,741 • Student, spouse and child: $3,911 • More than half charge additional premium for each child • Average cost: $1,026 per child

20. Texas Department of Insurance Premium Rate Increases • 22% increase from 2002/2003 to 2004/2005 • Average student rate increased from $590 to $718

21. Texas Department of Insurance School Plan Enrollment Rates • 47 schools were able to provide enrollment numbers • 35 public schools and 12 private schools • Average insurance enrollment rate was 11% • The highest rate was Baylor College of Medicine, at 77% • The lowest rate was at Prairie View A&M, at 0.24% • Average rate at health-related institutions was 37% • Average rate at private colleges was 19% • Average rate at public colleges was 8%

22. Texas Department of Insurance Semester Enrollment Fluctuation Rates • Enrollment declined in summer • Unless student selected full year coverage or spring and summer coverage (both of which cost more), they must take summer classes to obtain insurance

23. Texas Department of Insurance Semester Enrollment Fluctuation Rates (cont.)

24. Texas Department of Insurance Payment Method • Payment method matters! • Colleges that allow students to include insurance in tuition and fees have enrollment rates five times higher than schools where the insurer bills students • 58% of schools with high enrollment include insurance with tuition and fees, compared to 4% of low-enrollment plans

25. Texas Department of Insurance Marketing and Promotion • Many students and parents are not aware of the insurance option • Requiring students to accept or reject coverage during registration increases the enrollment rate by nearly 300%

26. Texas Department of Insurance Policy Benefits and Provisions in Student Insurance Plans • No medical underwriting; federal law prohibits discrimination based on health if the school receives federal funds • Benefits vary • The maximum benefit per injury or illness averaged $50,000 • 1/3 offer additional catastrophic protection • Average deductible varied from $50 to $750 • Caps on prescription drugs of $500 per year, with more generous caps in private colleges • Includes maternity coverage • Limited coverage for mental health, alcohol/drug abuse treatment, and inpatient care • Generally exclude routine, preventive services, with some exceptions for well-woman care

27. Texas Department of Insurance Common Policy Exclusions • Self-inflicted injuries, including suicide attempts • Injuries incurred while under the influence of drugs or alcohol • Injuries from high-risk activities such as sky diving or bungee jumping • Accidents related to motorcycles, three-wheelers and ATV’s

28. Texas Department of Insurance Survey of Students • TDI invited 16 colleges to participate in a student survey, and nine agreed • Web-based survey included 22 questions • 67.4% of students were insured; 29.1% were uninsured; and 3.5% were not sure

29. Texas Department of Insurance Students Most Likely to be Uninsured • Source of college funding is military (40%), scholarships/grants (37.5%), or student loans (36.7%) • Work status: part-time (34%) and not working (28%) • Hispanic (46.6%), African American (37.8%), Native American (37.5%) • Older students: Seniors (40.4%), Juniors (35.2%)

30. Texas Department of Insurance Reason for Losing Prior Coverage

31. Texas Department of Insurance Primary Reason for Being Uninsured

32. Texas Department of Insurance Reason for Not Buying School Coverage

33. Texas Department of Insurance How Much Can Students Pay?

34. Texas Department of Insurance Other States’ Requirements • Three states (Massachusetts, New Jersey and Idaho) require all students to have insurance • Large public university systems in Montana, California, Illinois and Minnesota also require coverage • Nationally, approximately 90% of private schools and 25% of public universities mandate coverage, primarily in northern states (except for California)

35. Texas Department of Insurance Issues Related to Increasing Enrollment in Student Insurance Plans • Affordability • Adequacy of coverage • Benefits • Exclusions • Accessibility

36. Texas Department of Insurance Policy Options for Consideration to Increase Coverage Through School-Sponsored Plans • More effective plan promotion, particularly “forced answer” systems to select or reject coverage • Increase communication between schools • Increase accessibility • Lower or eliminate minimum hour requirements • Allow spring/fall students to continue coverage through summer break • Student notification regarding a continuation option upon graduation • Increase the size of pools • Allow schools to join together to offer coverage • Improve benefits to attract more students • Increase communication between schools • Require coverage of all students

37. Texas Department of Insurance For additional information or copies of reports, contactDianne Longley at512-305-7298 or Dianne.Longley@tdi.state.tx.us.You can also visit the TDI website athttp://www.tdi.state.tx.usand the State Planning Grant website at http://www.tdi.state.tx.us/company/spg.