Best Health Insurance Options for College Students
Paying for college in the United States is outrageously expensive on its own.
However, there’s another cost most soon-to-be college students don’t think much about. That’s health insurance.
As a child, chances are students were on their parents’ policies. As a college student, things could change depending on their situation.
Thankfully, college students do have options for health insurance. Some may not require any changes at all.
Health Insurance Choices for College Students
As a college student, chances are you have several options to choose from. This is even more applicable to people under age 26.
Here’s what you should know about options for dependents and those that are no longer dependents.
Parents’ Health Insurance
Dependents under the age of 26 have the easiest health insurance option. They can simply stay on their parents’ health insurance plans.
The Affordable Care Act raised the age to stay on your parents’ plan. It now includes dependents as long as they’re under age 26.
This makes staying on a parent’s health insurance plan much more accessible to college students.
Unfortunately, you must be a dependent to qualify for your parents’ health insurance plan. People aged 26 or over don’t qualify, either.
You may have to discuss payment with your parents. Family health insurance plans often cost more than insurance plans for an individual or a couple.
If your parents cut you off when you turn 18, they may not be willing to pay for your health insurance.
Other families may have no problem doing this. Have a frank discussion with your family before this arises so everyone knows what to expect.
Health Care Marketplace Plans
Dependents and those that aren’t dependents can get plans through the health insurance marketplace.
For states that don’t run their exchanges, this is Healthcare.gov. States that run their exchanges have their own websites.
Dependents under age 26 living in the same state as their parents can be included on their parents’ application.
If you live in a different state, you can still apply with your parents but the plan may not fully cover you.
Alternatively, you can apply on your own in the state you go to college in. This gets a bit tricky, so be sure to read Healthcare.gov’s instructions when applying this way.
If you aren’t a dependent, you can apply on your own.
No matter how you apply, you or your family may qualify for a tax credit to help cover some of the costs of your plan.
This is based on the income of applicable family members based on your age and dependency status.
Student Health Plans
Your college or university may offer student health insurance plans. Some even go as far as automatically enrolling you in their health plan.
The Affordable Care Act states what these plans must cover, so they are regulated insurance.
You can access these plans whether you’re a dependent or not. They may be more affordable than the other options you have available, too.
Make sure you understand the details of how these plans work.
Some may only offer coverage when school is in session. This could leave you uninsured during summer vacation.
Costs, coverages, and providers will vary from school to school, too.
Talk to your school’s appropriate department to learn more about their student health plans when you’re considering which schools to apply for.
This may be the student planning or financial aid department.
Private Health Insurance Plans
Health insurance exists outside of the Affordable Care Act mandated marketplaces.
You can buy private health insurance plans that may be cheaper than your other options.
Insurance agents only work with one insurance company. These agents won’t be able to provide you with the broadest range of options.
The easiest way to find many plans is by talking to an insurance broker that works with several insurance companies.
These brokers are aware of many plans you may not know exist.
Then, you can look to see if any plans fit your unique needs as a college student.
Make sure you completely understand these plans before you sign up.
They don’t have to offer the same level of coverage that Affordable Care Act plans do.
Particular coverage may be excluded. Total costs the insurance pays out may be limited.
In some cases, you may not be able to renew these plans.
Be aware that the insurance salesperson works on commission, too. They’re experts, but they may get a higher commission for selling some plans than other plans.
This may influence what they steer you toward.
Use common sense when talking with a broker to make sure you’re getting the best deal possible.
One last note. Private health insurance plans do not qualify for tax subsidies. This could hurt their affordability.
If you’re a dependent and your family qualifies, you may be able to use this free or low-cost insurance option.
If you aren’t a dependent and don’t make much money, there’s an even higher chance you could qualify.
Certain people with disabilities or that are pregnant may also qualify for Medicaid.
Unfortunately, only some states expanded Medicaid. If your state didn’t expand Medicaid, you might not qualify.
Check your state’s Medicaid rules to learn more.
How to Choose a Health Insurance Plan
Choosing a health insurance plan is never easy, especially as a student. You have a long list of things to consider. They include the following.
What Plans You Qualify For
Based on the above information, you can figure out what plans you qualify for.
Then, compare the plans offered to you based on the following factors.
This can help you decide on the best option for you and your family.
When You Can Enroll
Depending on the time of the year, you may be stuck on your current plan. Open enrollment is usually toward the end of the year for plans for the following year.
You may qualify to change plans if you have a qualifying life event that gives you special enrollment periods.
If you need to change plans as soon as possible, check this list to learn more.
Look at the providers within an insurance plan’s network. In-network providers are often much cheaper to use than out-of-network providers.
Networks can be tricky if you go to school far away from your parents’ home or out of state.
Make sure providers exist where you’ll be going to school to avoid expensive out-of-network charges.
Each plan you qualify for usually has a cost.
For non-workplace-based plans, that cost is usually a monthly premium.
Premiums are generally higher for plans that have more costs associated with them.
Plans that cover more and offer lower costs almost always have higher premiums.
A deductible is an amount you must pay before health insurance kicks in.
Plans with high deductibles may discourage students from seeking care. That said, high-deductible plans typically have lower monthly premiums.
Copays or Coinsurance
After you’ve met your deductible, you still have to pay for health care.
Copays are flat dollar amounts you have to pay each time you seek care. They can vary depending on the type of service you need.
For example, copays may be as follows:
- $40 for a standard office visit
- $75 for a specialist doctor visit
- $200 for an emergency room visit
Coinsurance is like a copay but uses a percentage-based method for figuring out the cost.
Example of coinsurance include:
- 15% for a standard office visit
- 25% for a specialist doctor visit
- 35% for an emergency room visit
The higher the copay or coinsurance is, the lower your premiums will likely be.
Health insurance plans have out-of-pocket maximums that limit the total dollar amount you spend on covered health care in a year.
The maximums are often high. Even so, the maximum could save you a ton of money if you have many medical bills.
Out of pocket maximums do not include your monthly premiums. They do include costs such as deductibles, copays, or coinsurance.
The higher the out-of-pocket maximum is, the lower your monthly premium will likely be if all other factors are similar.
Some plans are mandated to cover certain expenses. Others are not.
If preventative care and mental health services are essential to you, make sure these items are included in the plan you sign up for.
This is particularly important for non-marketplace plans that don’t conform to the Affordable Care Act standards.
Some families get along great.
These families may offer to pay for a college student’s health insurance.
They may even keep the student on their health insurance plan at work.
Others have a toxic relationship where no help is offered. In this case, it may be best to secure health insurance on your own.
What About After College?
To make matters more complex, your health insurance options may change after you graduate from college.
If you land a job with health insurance, you may want to get on the plan the job offers.
Of course, people under age 26 can still stay on their parents’ plans.
Affordable Care Act plans through the marketplace and non-marketplace plans are options, too.
You’ll have to carefully consider all of your health insurance options, just like you did here.
Then, you can figure out your best post-college health insurance option to start saving money on health care costs.