The 2021 Back to School and Work Insurance Report
BY MICHAEL GIUSTI
As bleak as the Delta-variant fueled surge feels, August 2021 is a world apart from a year ago. Between COVID-19 vaccines, more effective clinical treatments, and government shutdowns all but lifted, people are now beginning to make their way back to school and to the office.
And with those returns comes lingering questions: What is safe? Who should wear a mask? Who should get vaccinated? Is a remote world the best choice? Who should get the right to make those choices in the first place? And how does insurance play into all of those issues?
This report aims to lay out the insurance-based questions and decisions people are going to be facing as they head back to school, and in many cases, back to work.
Covering Elementary, Middle and High Schools Students
With the elementary school-age population too young for vaccinations still, the back-to-school conversation is all about masking. In some places, such as Texas and Florida, governors are prohibiting mask mandates. While in many other states, masked pupils will be the order of the day.
From an insurance standpoint, K-12 students should be included in a standard employer-based family health plans. But not every family is covered by an employee plan. And in that case, it is worth exploring the CHIP program — the Children’s Health Insurance Program.
The CHIP program is designed to help bridge the gap for families that earn too much to qualify for Medicaid, but who still need low-cost health insurance coverage for their children. Qualification criteria are established on a state-by-state basis.
Costs for CHIP plans also vary by state, but they aren’t ever supposed to exceed 5% of a family income for the year. Unlike other health insurance programs, there is no open enrollment program for CHIP plans, so families can enroll at any time of the year.
Employee Health Insurance
As employees go back to the office, they need to be on the lookout for their benefits packages. That’s because open enrollment starts with the fall weather. Employees should expect benefits packets around Halloween and should be ready to pick their plan before Thanksgiving.
Picking an employer-sponsored plan doesn’t have to be confusing. Presuming the employer plan is an Affordable Care Act-compliant plan, policies are graded in “metal” tiers – bronze, silver, gold, platinum. These define the cost for coverage, not the quality of care.
Higher tiers cost more in the premiums, but their co-pays and co-insurance costs are lower, and they tend to have lower deductibles. Silver plans make the most sense for most people. Younger healthy people get by just fine on bronze plans. People with chronic health problems often opt for the higher tiers.
Employees should also pay attention to the way the plan approaches the provider networks – HMOs, PPOs, and EPOs can vary greatly in how they handle non-emergency situations. So, rather than getting caught up on the acronyms, the important thing to ask human resources is which plan will cover the doctors you want to see.
Employees shopping for coverage should take all the costs into consideration. A low premium doesn’t mean much if it means a policyholder will have to pay a steep deductible before they are covered by their health insurance plan.
Office Safety and Business Insurance
While masks and vaccines have become a cultural flash point, the law bends in their favor when it comes to the workplace. That is because the Occupational Safety and Health Administration requires employers to provide a place of employment free from hazards.
While that doesn’t outright mean that every employer needs to offer masks and mandate vaccines, it is still a hefty burden that employers must consider.
The best advice to employers is to follow CDC best practices. That means pay attention to distance, space, ventilation, good hygiene, and cleaning. That matters because of liability laws.
If someone can prove that they contracted COVID-19 at their place of work because of negligence from their employer, that can open the employer up for a liability lawsuit, and a potential claim against their business owner’s policy.
Some states have passed liability shield laws just for such a case, but the details differ by jurisdiction. Some protections are ironclad, while others have huge loopholes.
The best practice is to act in good faith and to protect the health and safety for people who are relying on you. If you fall anywhere short of the CDC guidelines, you may be opening yourself up for a liability claim.
And as far as the employees go, ensure that they never go to work sick. Whether in the classroom or in the office, the days of the perfect attendance awards should be banished for good.
A Closer Look at Universities and Colleges
Student Health Insurance
University campuses across the country are welcoming a flood of returning students. Many campuses — particularly private universities — are stipulating that returning students must be vaccinated. And most campuses are requiring face coverings for at least the next few weeks.
And while vaccinations and masks can help protect students from COVID-19, properly crafted insurance policies can help protect them from other risks they may face while pursuing a higher education.
When it comes to health insurance, nearly every school is going to require proof of sufficient health coverage before allowing a student to enroll. Some schools go so far as to buy a policy on each student’s behalf that they then need to repay to the university unless they can show they already have qualifying coverage.
The primary thing schools want to ensure is that if a student falls ill, or faces an emergency, there is an in-network physician who will be there to help.
For students who are dependents of their parents and who are under 26, the Affordable Care Act changed the landscape for college insurance. That is because those students can stay on their parents’ policy, which in most cases will satisfy the university’s minimum coverage requirement.
The important thing here is to make sure the network covers the student in the state where they are at school. A policy isn’t much use in Miami if the only doctors in network are in Minnesota. In this case, it might still make sense to get a plan in the state where the student is enrolled.
Staying on a parents’ plan also isn’t an option for older students, or for students who are independent from their parents, or whose parents don’t have insurance. But even in those cases, there are plenty of options.
The first place to start looking for students in need of a health insurance policy would be to start shopping for state marketplace-based Affordable Care Act plans.
Marketplace plans can be extremely attractive for independent students because they would then likely qualify for a substantial premium subsidy based on their income, or lack thereof.
For example, an independent student who earns less than about $17,000 per year would likely qualify for Medicaid – but only if they are in one of the 36 states that have expanded Medicaid.
Unfortunately, though, just because a student is unemployed doesn’t mean they automatically qualify for the top subsidy. Marketplace subsidies are based on the income of the whole household – not just the person who needs insurance. So, if that student is living at home, even though they may have filed their own taxes, they would likely still have to include their parents’ income on their health insurance application.
Another option for students to explore is a high deductible plan with an accompanying health savings account. While these don’t pay for much routine care, their premiums are very attractive, and might be a good option for an otherwise young and healthy college student.
The good news is that any Affordable Care Act complying policy will cover COVID-19 expenses, testing, and vaccination.
Life Insurance for College Students?
As far as life insurance, most college students wouldn’t normally give a life insurance policy a second thought. Life insurance is designed to cover financial obligations in case someone dies. In the case of most student loans, if someone dies, the debt they carry dies with them. But that isn’t the case in some loans, such as a Parent PLUS Loan.
With Parent PLUS Loans, the parent takes on the debt obligation. So, if a college student is asking their parent to take on a huge debt obligation on their behalf, this would be a good case for a term life insurance policy that would cover that college debt in case the student unexpectedly dies — particularly a term life insurance policy.
Auto Insurance for College Students
Students should also be thinking about insuring their vehicle while they head off to college. Much like health insurance, if a student is a dependent and can stay on their parents’ auto policy, that is likely to offer the most protection at the lowest premium.
If a student has to get their own policy, one truth of auto insurance rates will hit them right in the face — younger people tend to pay more for the same coverage. On top of that, adults tend to have other policies they can bundle in with their auto policy, bringing the premium further down.
Insurance for College Housing
Renter’s insurance is another way students can be protected, because, living in a dorm or an apartment comes with risks, which renter’s insurance helps mitigate.
Because renter’s insurance doesn’t pay to protect the actual structure, the rates are surprisingly low – in the ballpark of $20 per month or less. And with that premium, students are protected if their bike or laptop is stolen, or if their clothing is destroyed by a busted pipe, or if something is lost due to vandalism, theft, fire, lightning, windstorms, or hail.
Renter’s policies won’t cover normal wear and tear or unexplained/mysterious disappearances – so, police reports are likely required to make a claim if something is stolen.
And it is essential to read through the policy to ensure that flood or earthquake damage is covered, because it may require a specific rider.
Renter’s insurance also typically includes a personal liability protection and medical payments for guests in the case that someone is injured in the student’s home.
College Tuition Insurance
Tuition insurance is designed to reimburse a student in case they paid for their semester in full but can’t finish for a covered reason beyond their control. Tuition insurance can help in cases of injury, illness, chronic illness, or mental health. So, if a student contracts Coronavirus and can’t finish their term, tuition insurance can step in.
A typical tuition insurance policy covers tuition, room and board, and some fees. Most tuition insurance policies typically cost a little more than 1% of the cost of tuition. So, if you would be on the hook for $10,000 for the semester, expect to pay a little more than $100 for a tuition insurance policy.
For all your insurance needs it is recommended that you compare insurance quotes often and stay informed. This ensures you’ll get the most out of your policies for the best price.