Understanding Health Insurance Coverage for College Students

From dorm room size to academics, parents have plenty of questions about college life—especially if they're footing the bill. But one big-ticket item that often goes overlooked is health insurance. Will your current healthcare plan cover your child for the next four years? And is it the best option for your family?

Know Your Plan

Thanks to the Affordable Care Act, your children can remain on your family health insurance policy until the age of 26, so their time in college is covered. This is true whether you have a plan from your employer or from your state’s healthcare exchange.

But the devil is in the details, and you’ll need to carefully read over your benefits to know if your plan will work for your child in college. This is especially important if your child plans to attend an out-of-state university. Many smaller insurers have limited, regional networks, so it could be difficult to find a hospital or provider that will be covered.

It's important to remember that if you do need to change your health insurance provider, you need to look at the insurance marketplace during the open enrollment period. This may or may not align with when your child is going off to school so keep the timing in mind as you prepare.

Pro Tip: Use your health insurance company’s online search features to find providers in the area where your child will be living. If none exist, call to see if they offer any special coverage for dependents living out of network.

Research Student Health Plan Coverage

Knowing that insurance coverage can be a problem for out-of-state students, most colleges offer a student health insurance plan. The average cost for these plans is $1500-$2500 per year. Be sure to read the fine print about what providers and services are covered, and check if the coverage lasts for a full year or only when classes are in session. Some student health plans are backed by national carriers and offer coverage for providers across the country, making it a good choice for kids who will travel back and forth regularly for the next four years.

It’s also important to pay attention to all of the school's correspondence about billing and health insurance. Many institutions automatically bill for the cost of health insurance and require a waiver to opt out of the plan. Stay on top of these dates to avoid an unpleasant surprise on your tuition bill.

Pro Tip: Many colleges have social media groups for parents, which are great places to ask for reviews of the student health plan from people who have actually used it.

Comparison Shop

If your plan doesn’t cover emergency room visits in the town where your child is attending college, you’ll need to purchase new insurance. But even if it does provide coverage, it’s a good idea to run the numbers to see if a local plan offers any savings.

There are several options for health insurance for students:

• Your family health insurance plan

• Student health insurance offered by the school or university

• Exchange-based plans

• Short-term heath insurance

• Medicaid

To accurately compare prices, you’ll need to add up the premium costs, plus an estimate of copays. You can do this by estimating how many sick and well visits your child typically makes in a year to various providers.

Pro Tip: It’s usually cheaper to stick with a family plan if possible, but if removing your child allows you to drop down to a single or couple’s plan, you could reap significant savings by purchasing student health insurance.

Know Your Needs

Finally, check into the services offered on campus at the university health center. If your child is generally healthy, this may be all you need — plus emergency coverage at a local hospital in case of an accident. Weigh your options carefully, taking into account the providers, services, and costs so you can make a smart financial decision. After you’ve done the legwork, it’s time to relax and focus on shopping for dorm room accessories and getting ready for move-in day.