School says state medical coverage not good enough, but many call policy a unfair for students

by: TRIBUNE PHOTO: JAIME VALDEZ - OHSU pharmacy student Whitney Woolstenhulme has been fighting her schools decision to insist she and others pay for OHSU health insurance even though they are already covered by other plansKim Cathcart doesn’t have a lot of spare change lying around. She’s a third-year pharmacy student at Oregon Health & Science University, so she hopes to be making good money in a few years. But right now she’s amassing huge student debt while living with her husband, a disabled veteran, and their 12-year-old son on about $1,200 a month.

For health insurance, Cathcart has been covered for the last several years through the Oregon Health Plan. She’s been pleased with the Oregon version of Medicaid, which covers her dental care and keeps medication and other out of pocket costs to a minimum.

So you can understand why Cathcart was upset when administrators at OHSU told her in February that despite her OHP insurance she would have to buy into OHSU’s health plan, which will cost her about $4,000 a year for basic coverage, not to mention a $500 annual deductible and 20 percent co-pays.

“This health plan will cost our family thousands we simply cannot afford,” Cathcart says.

Whitney Woolstenhulme is another OHSU pharmacy student facing a similar predicament. Woolstenhulme works 20 hours a week as a pharmacy intern for Kaiser Permanente while studying for her pharmacy doctorate. She’s covered by a Kaiser HMO plan that Kaiser officials call “solid.” Yet OHSU is saying that plan isn’t good enough — Woolstenhulme, like Cathcart, is being told by OHSU she has to buy the school’s health insurance if she wants to stay at OHSU.

“I have to take out student loans to cover the cost or I cannot come back. They won’t allow me to enroll,” Woolstenhulme says.

Woolstenhulme says she knows of at least 10 students in her fourth-year pharmacy class of about 100 who have been told their own health insurance plans aren’t good enough to qualify for a waiver from OHSU. Which means they have to buy OHSU’s health insurance. She suspects that between the school’s medical, dental, nursing and pharmacy students there could be more than 100 facing a situation she calls “super shady.”

Health insurance experts say that OHSU’s policy, basically, is a ripoff. Schools in Oregon can require their students to carry health insurance, but they don’t have the right to insist students pay for the university plan.

On average, they say, university students around the country pay $1,500 to $2,000 a year when they purchase school health plans — about half of what OHSU is demanding. That’s because students represent the lowest risk and highest profitability for insurers — for the most part they’re young and healthy and rarely use health care.

OHSU’s policy is running against the national trend, says Devon Herrick, a health economist with the Dallas, Texas-based National Center for Policy Analysis. Since the Affordable Care Act was implemented last year requiring nearly everyone to have insurance and providing more low-cost coverage options, school health plans have become less necessary, Herrick says. In fact, some schools have decided they no longer need to offer insurance to students.

“It doesn’t make sense to tell a student, ‘No, your insurance is not good enough, even what the state gives you is not good enough.’ How crazy is that?” Herrick says.

OHSU cutting costs

The OHSU policy may be the result of the school’s recent decision to self-insure its students rather than pooling them with others seeking coverage, says Christina Postolowski, a senior policy analyst with Young Invincibles, a Washington, D.C.-based nonprofit promoting health care rights for young adults.

“The school is making a choice to self-insure their students,” Postolowski says. “A lot of schools don’t.”

Nationally, most health insurance plans at small schools such as OHSU pool their students with others needing coverage, Postolowski explains. Some larger organizations such as the California university system self-insure knowing they won’t have a problem getting enough participants in the pool. But self-insuring a small group such as OHSU’s 2,200 students can force an organization to get tough with those who don’t want to join.

OHSU officials refused repeated requests for interviews to explain their policy and address students’ concerns. They did provide the Tribune with a written statement outlining OHSU policy. In that statement OHSU said it did not anticipate a significant change in the number of students who would qualify for waivers.

Yet OHSU also said in the statement that last school year about 60 of its students were allowed to substitute Oregon Health Plan coverage for the OHSU insurance, which will no longer be allowed. OHSU also said in the statement that the move to self-insurance was made to keep costs down.

According to Herrick, universities have historically required only international students to purchase their health insurance. In fact, he says he attended graduate school on his way to a doctorate without any health coverage.

Herrick says school-based insurance plans are making less and less sense in a post-Affordable Care Act world, where the federal government has imposed minimum standards for insurance policies and offered subsidies for health insurance. University plans, designed to provide minimum coverage for enrollees who won’t need much health care, can’t compete with that, Herrick says.

Fewer waivers allowed

Which might explain why OHSU has tightened up its rules so that fewer students can obtain waivers that allows them to find their own health insurance, Herrick says. OHSU has made it difficult to avoid buying into their plan by insisting students be covered anywhere in the country.

“My theory is maybe there’s somebody at OHSU, maybe a department, that’s getting a kickback if they get high enough enrollment,” says pharmacy student Cathcart. “I hope that’s not the case.”

In its written statement, OHSU does not mention a need to corral students in its own health plan. But a memo sent to all students and obtained by the Tribune provides evidence that the university is trying to do just that. In the email OHSU says they’ve tightened the waiver requirements to “create a viable plan for all students. Without broad-based student participation, providing a health plan to a small group of students becomes too costly and therefore unviable.”

Woolstenhulme says she’s tried to talk to OHSU administrators and explain that the OHSU policy might keep her from graduating. She’s in her final year of pharmacy school and says she simply doesn’t have the extra $4,000 for OHSU’s health insurance.

Adam (not his real name) is another OHSU student upset with the OHSU policy. He shares a one-bedroom apartment with a friend, gets about $1,000 a month in financial aid to live on, virtually never goes out to eat, and is being told he must pay more than $4,000 a year for OHSU health insurance. This spring he applied for and was enrolled in the Oregon Health Plan, which provides insurance at virtually no cost to him.

Adam says his four years of pharmacy school will leave him about $200,000 in debt. Four-year students forced to pay OHSU for health insurance will be adding an extra $20,000 to their debt, he says. Some students, he says, could change careers based on that.

“A lot of people coming out with all that extra debt, I think, are going to be pressured to go into retail pharmacy rather than do a residency,” Adam says.

Federal mandates require that Oregon Health Plan coverage be comparable to most private plans, says Sabrina Corlette, an attorney and senior research fellow at Georgetown University’s Health Policy Institute. “Maybe the university wants to hang on to that premium revenue and not lose it. But that is not in the best interest of students,” Corlette says.

“It strikes me as a little bit strange that a university would be passing judgment on the adequacy or lack thereof for policies that have passed muster with state insurance regulators and the federal government,” Corlette says.

Woolstenhulme says she is especially bothered by OHSU’s policy toward its poorest students who have gained coverage through the Oregon Health Plan.

“I’m most upset that Medicaid students have to pay for additional coverage when my tax dollars already fund insurance that covers them completely,” she says.

Editor’s Note: As the Tribune was going to press Whitney Woolstenhulme called to say OHSU had just notified her that her Kaiser insurance qualifed for a waiver from the OHSU insurance requirement. Asked to explain OHSU’s change of heart, she said, “I think they got a lot of pressure and because I’m making the biggest fuss about this, they feel if they can silence me they can push this issue under the rug. I still would like to see things change for everyone else.”

Oregon Heath and Science University officials declined to be interviewed for this news story. Instead, OHSU submitted this statement regarding student health plans:

Oregon Health & Science University offers a health plan for students to ensure they remain healthy and to prevent, to the extent possible, catastrophic medical expenses. Some accrediting agencies require health care education programs to provide a health insurance plan for students. For example, the entity that accredits all U.S. medical schools — the Liaison Committee on Medical Education — requires that all U.S. medical schools offer health insurance to their students.

Many universities and companies that provide health insurance require their students and/or employees participate in their health insurance plans unless the individuals have adequate health insurance through other means. OHSU follows that policy for its students and employees.

There are several good reasons why OHSU wants to ensure its students have adequate health insurance. The most important are:

• OHSU students continually interact with hospital patients, often daily. For the benefit of our patients — and to ensure our students stay healthy — we want to be sure that students have good health care through adequate insurance coverage.

• We want our students to remain financially stable, to not be forced to suspend their studies — and their careers — because of financial hardship due to lack of adequate health insurance.

To ensure students who do not use OHSU health insurance have adequate insurance coverage, we, like many universities and medical schools, have a process by which students who have insurance plans that meet certain criteria can waive OHSU’s plan.

This year, to avoid what was forecasted to be a 12 to 18 percent increase in costs for student health insurance premiums, OHSU moved to self-insurance funding for its student insurance plan. Monthly health insurance premiums for the 2014-2015 year are $295.09 for health insurance. Medical premiums remain unchanged from the 2013-2014 year.

The decision to move to self-insurance — and all decisions relating to student health insurance, including determining the criteria waiving the OHSU-sponsored plan — are guided by an OHSU advisory committee called the Student Health Advisory Council. It includes OHSU staff and 19 students representing various OHSU schools and programs.

There are a number of criteria that we have to determine if a health plan qualifies for a waiver out of OHSU student health insurance. Among them: out-of-pocket costs for a non-OHSU-sponsored plan cannot exceed $6,000 per year, and the plan must provide care outside of Oregon, beyond urgent/emergency care. That’s important because many of our students participate in medical rotations out of state and travel to their home states outside of Oregon.

The waiver criteria is reviewed annually. Due to changes in insurance plans caused by health care reform, updates were made to the waiver criteria this year.

Last year, about 40 percent of OHSU students had health plans that qualified for an exemption from the OHSU student health plan. We don’t yet know the percentage of students who will qualify for exemptions this year, but we don’t anticipate a significant percentage change.

There are some plans that won't qualify for an exemption. Included in that group is the Oregon Health Plan. Last year, about 60 students were allowed to substitute Oregon Health Plan coverage for OHSU's health plan. Because of changes to waiver criteria that went into effect June 1, Oregon Health Plan participants will no longer be able to substitute that coverage for OHSU's student health insurance.

Again, OHSU's goal is to ensure that its students remain healthy and financially stable. With input from the Student Health Advisory Council, OHSU pays close attention to student views on what our health insurance provides, what it costs and how our students can use other insurance. OHSU students have been clear over the years: they prefer, on balance, to have a robust plan with higher premiums rather than a plan with low premiums that would burden those students who may need services the most.

OHSU and the Student Health Advisory Council are committed to a comprehensive review of all options now available for student coverage and will re-examine options for potential changes for the 2015-2016 plan year when the advisory council resumes its work in October 2014. Meanwhile, the university continues to explore best practices based on the student health plans at other academic institutions throughout the U.S.

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