By teaming together, UC campuses have negotiated a system wide insurance coverage bent on saving students’ money. The new plan – effective fall 2011 – will come with an increase in benefits, a reduction in student coverage fees and future savings.
“The motivation was to create a systemwide student health insurance that offers students better benefits, stabilizes the cost and achieves administrative efficiency,” said Heather Pineda, director of the UC Student Health Insurance Plan (UC SHIP).
The new features of the plan are concentrated in pharmaceutical and treatment benefits and lowering the student coverage fees. The previous plan covered $5,000 worth of treatment costs – the new one covers $10,000. Moreover, in terms of coverage fees, the previous plan covered 80 percent of healthcare cost while students paid 20 percent. The new plan covers 90 percent of costs, and students will pay 10 percent.
“For next year’s UC SHIP, the combined savings are estimated at about $7 million – by coming together, the savings are real,” said Charles Auchterlonie, business services manager with Student Health Services at UC Davis.
In 2008, UC formed a workgroup that aimed to look at student health plans across the system. Historically, each UC campus operated a separate insurance plan for its 130,000 graduate and undergraduate students. The group found that the creation of a system wide insurance plan would create savings, said UC spokesperson Leslie Sepuka in an e-mail interview.
“The larger the number of insured on the insurance program, the better bargain you can get when negotiating with insurance rates,” Auchterlonie said.
This new, system wide plan was implemented in six of the 10 UC campuses in the 2010-2011 academic year for graduate students only. Around 14,000 graduate students participated in this initial testing of the plan.
“Last year with the six campuses joining, the [UC Office of the President] did a study and looked at standalone and looked at UC SHIP, and it looks like the savings were approximately $4 million for the graduate students,” Auchterlonie said.
There will be an increased premium cost for students. For undergraduate students, the premium fee is currently $374 per quarter and for graduate students it is $682 per quarter. With the UC SHIP plan, undergraduates will pay $421 per quarter and graduate students will pay $722 per quarter. This is a 12 percent and 6 percent increase, respectively.
This may seem like a significant increase, but if the campus remained as a standalone and negotiated its own rates, UC Davis would have been looking at close to a 20 percent increase, Auchterlonie said.
Students with comparable health insurance will still have the option to waive UC SHIP. In addition, since the insurance costs are billed to the student account, financial aid will help cover the cost of the insurance.
Pineda said that UC SHIP is a leader nationwide due to its comprehensive coverage. In addition, merging the campuses together increased the purchasing potential of such a large system like the UC.
“Consolidation will be a trend in future years,” Pineda said.
UCOP is currently putting together a more detailed web page that will come out in a week or two with information about the plan, Auchterlonie said.
AMIR BEGOVIC can be reached at campus@theaggie.org.
