On Tuesday, Oct. 11, members of the Graduate Student Senate (GSS) executive board and staff, along with representatives of the Graduate Employee Organization (GEO), met with university administrators to discuss the recent changes to the Student Health Insurance Plan that have led to increased health care costs for students covered under the plan–some 2,500 GEO members, hundreds of other grad students and thousands of undergraduate students as well (around 6,000 students total). Since August, grad students have been required to pay, for the first time, a 15 percent “coinsurance” fee for any service performed outside of the University Health Services up to a maximum of $5,000. The plan deductible also increased to $250 from $200 and prescription drug co-pays also increased.
GSS and GEO leaders were hoping to find out why the plan changed so significantly, why graduate students were left out of the process and how we might rectify that in the future. Also, these representatives expressed their concerns that the new changes have a disproportionately adverse effect on women as gynecological care and many services related to pregnancy are not offered through UHS (there is not a specialized Ob/Gyn at UHS, though regular practitioners there offer some gynecological services).
UHS director Bernie Daly said that the changes to the health care coverage were needed to avoid a roughly 30 percent increase in the individual premiums paid to Aetna, the company contracted to provide health insurance. The premium instead rose by 17 percent. She indicated that the administration did not want to raise these premiums too high across the board, even while conceding that the new “co-insurance” will shift a disproportionate burden of the increases to those with chronic and on-going issues as well as women, particularly pregnant women.
It is unclear exactly why Aetna needed to raise rates and decrease coverage at such levels this year. According to a press release summarizing their second-quarter 2011 financials, Aetna’s net income increased 9% to $536.7 million (see that document here.)
GSS representatives asked why input from students on whether they would prefer a premium increase or a decrease in coverage was not solicited. Daly indicated that it somehow fell through the cracks.
One positive development to come out of the meeting was a verbal agreement by the administrators to include one graduate student and one undergraduate student throughout next year’s SHIP bidding process. According to the verbal agreement, these representatives, to be appointed by GSS and SGA, will be voting members on a steering committee that will guide the next round of negotiations with insurance companies.
Also, when pressed by members of GEO regarding a public statement made by representative of the administration this summer that part of the reason for the increase was to cover a $500,000 deficit last year, Daly conceded that the deficit was due to a one-time “R&R” contribution that covered the repairs and large equipment purchases; an expense that, if spread out over several years would actually indicate that the UHS runs a surplus every year.
Daly then said that the UHS actually projects to run at a surplus this year of $2.4 million to $2.5 million. A huge chunk of this revenue will be generated because in the past Aetna did not reimburse UHS for services given to SHIP enrollees, but under the new plan Aetna reimburses these services at a rate of 85 percent, which is projected to that $2.5 million. In short, part of the deal that saw our “co-insurance” become necessary is putting additional revenue of $2.5 million per year into UHS coffers. This money, it was indicated, is necessary to face the eventuality of the need for a new UHS building.
When asked why this reason has not been previously made public in explanations about the insurance increase, Daly and the other administrators had no response.
Anyone interested in serving as a graduate student representative on the steering committee should contact GSS President Hongmei Sun at firstname.lastname@example.org.