Health Insurance for Students
Most students, unless they qualify for an exemption, will have to purchase health insurance or they will be subject to a tax penalty.
A student may be eligible for an exemption, for example, if a student is not lawfully present in the United States or if they do not file taxes because they are below the tax filing threshold.
Student Health Plans and the Affordable Care Act
A “student health plan” refers to a special policy of health coverage that colleges and universities make available to their enrolled students. Typically, the student health plan is different from the employer-sponsored group coverage that colleges and universities offer their faculty and staff.
Student health plans count as health insurance coverage (e.g. “minimum essential coverage”) under the Affordable Care Act. Therefore, for the months consumers are enrolled in student health coverage, they will not have to pay a penalty.
If students have a “fully insured” student health plan, that plan does have to cover all 10 of the essential health benefits,” including ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, behavioral health treatment, prescription drugs, rehabilitative and habilitative services and devices, laboratory services, preventive and wellness services and chronic disease management, and pediatric services including oral and vision care. Generally, fully insured plans must also offer contraceptives without cost-sharing (meaning no co-pays, etc.). A fully insured plan is one that your college or university purchases from a health insurance company.
However, if the student health plan is “self-insured,” it might not be required to cover essential health benefits. Consumers should check with their college to find out what type of student health plan it offers.
Covered California Coverage for Students
Students can opt out of their student health plans and purchase coverage through Covered California. Depending on income, students may receive tax credits to help pay for a private health plan through Covered California or receive low- or no-cost coverage through Medi-Cal.
If, however, students accept and enroll in the school’s health insurance plan, they will not be eligible for tax credits through Covered California while they are covered by their school’s plan. When students are considering whether to enroll in their school’s health insurance plan or a Covered California health plan, they should consider the location of clinics/doctors and the costs of accessing services.
Minimum Coverage Plans
If students are under 30, they may be able to buy an additional health insurance plan option called a minimum coverage plan. These minimum coverage plans usually have lower premiums and mostly protect consumers from worst-case scenarios. Catastrophic plans through Covered California cover three doctor visits or urgent care visits, including outpatient mental health/substance use visits, with no out-of-pocket costs, and free preventive benefits. All other services will be full price but at the negotiated in-network price, until an individual spends $8,150, after which all in-network services are covered at 100 percent.
Student Health Plans and Parent Health Plans
For a Covered California health plan, as long as students are a tax dependent of their parent(s) or under the age of 26, their eligibility for student health coverage does not make them ineligible to be covered on their parent’s family health plan.
When making this decision, students should consider their parent’s insurance coverage network. If students attend a school that is far away from their parent’s home, their parent’s health insurance may not cover medical services provided to them while they are away at school. Students should speak with their parent’s health insurance plan for more information. If the student is going to school outside the state of California, only emergency services will be covered by a Covered California health insurance plan. Non-emergency services received outside the state of California will not be covered.
If students are claimed as a dependent on their parent’s taxes and choose to opt out of their student health coverage, their parent’s Covered California family plan would still be eligible for tax credits. Additionally, if students choose to stay or accept their student health plan, their parents would still be eligible for tax credits through Covered California, if otherwise eligible. However, parents must correctly state on their application that although their child (the student) is a tax dependent, they are not seeking health coverage through their (the parents’) Covered California health plan.
However, a student considering opting out of their student health plan to take part in a family plan through Covered California should consider the coverage network. If the school they attend is far away from the parent’s home, the parent’s health insurance may not cover medical services while the student is away at school. Students considering this option should speak with their parents’ health insurance plan for more information.
If students are tax dependents, they can be covered under their parents’ Covered California health plan, no matter where they live. However, Covered California does not offer any health plan products that have a network of doctors, hospitals or other health care providers outside of California at this time. Therefore, if the school the student attends is out-of-state, the parent’s health insurance will not cover most medical services while the student is away at school. The exception being that all emergency services must be covered at the in-network price, even if the service was received out of state. Students considering this option should speak with their parent’s health insurance plans for more information.