Health Care's Financial Toll on College Parents

Many college students find themselves spending time in the university student health center. Fortunately, many universities have a health center strategically located on campus.

What may not be so fortunate for the student will be the level of care offered, as consistency and quality vary greatly from campus to campus. And what may not be so fortunate for you will be the cost/value relationship of such care for your student.

University health centers have not escaped the wrath of health cost increases grossly outpacing the Consumer Price Index. And student health center users find themselves mired in an industry replete with rising demands, yet without commensurate institutional funding to pay for desired care.

What are some the financial challenges impacting student health centers and the direct financial toll to students and parents?

A student health center differs from a typical primary practice setting. Indeed, your son or daughter can receive, in addition to clinical care, access to excellent wellness and education programs.

But these wellness programs require funding. The ideal funding source is the institution itself, but with fewer and fewer dollars making their way from state governments to public universities, the revenue to fund university health centers remains a challenge.

The financial impact of wellness programs, however, does not even begin to approach the clinical costs of operating a student health center. These costs are often funded through a combination of student health fees included with tuition, pharmacy revenues and fees for service for many ancillary services like x-rays and labs.

However, many student health centers are structured to not accept your student’s private insurance, despite a significant number of students carrying insurance through a parent. Surprisingly, even many universities that mandate its students carry health insurance do not bill insurance.

Penn State conducted a survey in 2004 indicating that 59.9% of students had health insurance through a parent. Another 8.5% had government sponsored health insurance such as Tricare or individually purchased commercial insurance. Another 5.3% carried insurance through an employer sponsored plan provided by a spouse or employer, 10.9% carried graduate assistance/fellow insurance, 5.1% bought the student health insurance plan, while a staggering 10.3% were uncertain about their provider.

Yet despite the prevalence of insurance coverage, Penn State and many other universities will not accept insurance. Many will not charge an office visit fee, and if they do, it usually amounts to a nominal fee, akin to a co-payment charge. However, they do not bill insurance for the office visit. This practice, or financial malpractice, sacrifices a significant revenue stream that may be compensated by higher than necessary student health fees.

In addition, because these student health centers do not accept your insurance, then your child – or in most cases, you – pay out of pocket for various x-rays and labs. Indeed, at The University of Florida (UF) students and parents paid over $4,000,000 in ancillary services in 2004-05, a number that would presumably have been much smaller had UF accepted health insurance.