One of the great things about going to a university is a campus health care system. At PSU, any student enrolled for five credits or more pays a modest $167 per quarter for access to doctors, counseling and other great services.
These benefits are nice, but in terms of priorities, PSU has it backward. The primary purpose of health insurance is to protect people financially after a major medical event. The cost of treating a serious illness or accident these days can be daunting. Serious surgery or an extended stay in a hospital can put an uninsured patient on the line for tens of thousands of dollars or more.
PSU’s mandatory and basic health insurance pays no more than $7,500 per incident, per academic year. This is obviously inadequate, and there is a supplemental policy that can be purchased for about $500 a quarter.
Unfortunately, this “catastrophic” health insurance is not only relatively expensive to comparable group plans, but also provides relatively thin coverage, mostly because so few people participate in it. Less than 200 PSU students currently buy the supplemental coverage, leaving an estimated 50 percent of PSU’s student population dangerously under-insured.
After their basic plan benefits have been exhausted, a student who has the supplemental plan would pay the next $500 out of pocket. The supplemental insurance pays 75 percent of the remaining charges, up to the annual cap of just $45,000. This would probably protect someone from a bad accident or limited hospitalization, but not for something requiring long-term care and treatment, like breast cancer.
Once the cap is reached in a given year for any incident, the student is legally responsible for everything else. Compare this to most employer-based and individual insurance plans, which provide a standard $1 or $2 million in lifetime coverage, and limit a person’s annual out-of-pocket expenses.
Those without the supplemental or other coverage are especially vulnerable. Imagine this scenario: You’re riding your bike to campus and take a bad spill. After an ambulance ride, a surgery and a week or two in the hospital, it’s plausible you could check out with a bill of $25,000. If you are one of the roughly 50 percent of PSU students carrying only the basic insurance plan, you now have at least $17,500 in medical debt to deal with.
If you’re one of these underinsured students, perhaps you would like better coverage, but the monthly expense seems to outweigh the relatively small risk of getting seriously hurt or ill. If PSU’s costs are a problem, looking for your own insurance won’t do much good.
Unless you’re very young and very healthy, buying individual insurance on the open market can be prohibitively expensive. Group insurance is almost always more affordable because it pools risk among a large number of people.
How can we make PSU’s insurance better and more affordable? The answer is to throw our collective weight around. If PSU can tell insurance companies they have a large, young and relatively healthy population looking for coverage, they should be able to negotiate very favorable terms, much like a large employer would. If PSU were to team up with the other universities in Oregon’s public system, it might be even better.
To negotiate, PSU would have to guarantee that a large group would buy in, meaning a comprehensive insurance policy should be mandatory, with one exception. Those already covered under their parents’ plan, an employer’s or some other arrangement should be able to submit a “hard-waiver” to the university, proving they’re adequately covered elsewhere.
Why mandate health insurance? It’s really a question of fairness. When people who are uninsured or underinsured get hurt, they aren’t the only ones affected, physically and financially. Doctors and hospitals always treat people who are injured or gravely ill, and worry about the billing later. Bills that go unpaid eventually result in higher costs and premiums for everybody.
Portland State is certainly not alone in underinsuring its students. These are financially tough times for most public universities. Still, PSU can and should do better. By better using its bargaining power, PSU can give every student peace of mind about their health, at a reasonable cost.