In April, we announced plans to discontinue dependent health insurance as part of the UC Berkeley Student Health Insurance Plan, or SHIP. There are currently more than 22,000 students, undergraduate and graduate, on SHIP, and 122 of these students have family members in the voluntary dependent plan. We made this decision because students would have to shoulder significant additional costs to keep the voluntary plans and because there are affordable, comparable health-plan alternatives offered by the state, federal government and exchanges.
What factors were considered when making this decision? Assuming enrollment in SHIP stays consistent next year, if we had taken no action and kept dependents on the plan, undergraduates would have paid an additional $193 and graduate students would have paid an additional $384 per year, on top of existing premium increases. Graduate students would be paying more than $4,100 for SHIP. Altogether, this means the 22,000 students enrolled in SHIP would pay about an additional $6 million in premiums.
The premiums would have changed for dependents, too, and would have varied by the number of family members placed on the plan. For a graduate student with one dependent — child or adult — the premiums would have been $4,138. But for graduate students with two children on the dependent plan, their premiums would have increased by an alarming 84.5 percent. Buying insurance for two children on SHIP currently costs $4,232 per year for a graduate student. Next year, it would have cost $7,807.
UC Berkeley originally offered the dependent plan because other affordable options were not as readily available, especially for those with pre-existing conditions. With recent health insurance reform, there are federal and state exchanges and Medi-Cal that offer students and their families more affordable and comparable health plans. Low-income families and individuals may also qualify for subsidies on the exchanges that lower the cost of insurance. Additionally, the Affordable Care Act now makes it illegal for insurance plans to discriminate against or charge more for people who have a pre-existing health condition, such as asthma or cancer, meaning insurance companies cannot look at health status when they calculate premiums.
What are we doing to help student families? To help smooth the transition, we’re offering a free insurance helpline at 855-251-9094 to assist students and their families in finding alternative coverage before the dependent plan expires. Additionally, we realize some families may need even more assistance. This week, we are offering two new services. Firstly, we offer the option for these families to work with our experienced insurance staff one-on-one if the insurance helpline is not meeting their needs. Secondly, we have established a new Dependent Transition Assistance fund for families that qualify. We are also holding an information session June 10, with onsite assistance from our helpline. More details on assistance options are available at the SHIP office or on its website.
How was this decision made? Students have always been involved in the SHIP decision-making process, because any changes directly affect them. In early April, we announced plans to discontinue voluntary health insurance plans — including dependent plans — after careful collaboration with staff and students, including our Student Health Insurance Advisory Committee. Of the 22,000 students, undergraduate and graduate, enrolled in SHIP, 122 have family members on the dependent plan — less than 1 percent of the total population. We made this decision because the voluntary plans have become financially burdensome on the larger student population and because there are sufficient, affordable, comparable alternatives on the Covered California health insurance exchange and from Medi-Cal.
What other options did you explore? Some may argue that we should have negotiated other cost-containment strategies to keep costs lower for students and their dependents. We looked at a number of these strategies, including lowering benefits for students on SHIP. But even if we had increased students’ co-pays for doctors’ visits and pharmacy prescriptions, increased the out-of-pocket maximum, lowered coverage to 85 percent and increased the emergency-room co-pay, the savings to students would still not compare with the savings generated by discontinuing the voluntary plans.
This decision wasn’t easy, but when we looked at all the facts, kept in mind our responsibility to all students and took into account that we are in an environment where health insurance costs are on the rise for everyone — two UC campuses and several peer institutions are making similar decisions about dependent care — we came up with a decision that meets the needs of 99 percent of SHIP enrollees while still leaving a path forward for students’ families.
Claudia Covello is the executive director of UC Berkeley’s University Health Services.