UC SHIP rates unaffected by Affordable Care Act insurance increases

Increasing prices on health insurance plans under the Affordable Care Act will not affect student health insurance fees.

Premiums for a group of insurance plans on the federal health care marketplace will increase by an average of 25 percent next year. Premiums on the exchanges have no impact on University of California Student Health Insurance Plan rates said UC spokesperson Claire Doan in an email statement.

“UC SHIP rates are only affected by claims within the member pool,” Doan added.

[Throwback: UC SHIP may increase premiums by 20 percent to pay for deficit]

The nationwide premium increase is up from the 7 percent increase in 2016 and 2 percent increase in 2015. In California, premiums will increase by an average of 13 percent next year, up from the 4 percent increases in 2016 and 2015.

According to a report from the Department of Health and Human Services, premiums are increasing nationwide because insurers underestimated the cost of extending coverage to people with pre-existing health conditions.

Gerald Kominski, a professor of health policy and management and director of UCLA’s Center for Health Policy Research, said he does not think the reason for national price increases is as simple as what insurance companies are saying.

“I’m not sure I believe that (insurers are losing money),” Kominski said.

Kominski said two programs in the first three years of the Affordable Care Act were designed to protect insurance companies. Individuals who had postponed surgery or other major expenses because they lacked health insurance would present a large, temporary increase in cost to insurance companies. The federal government implemented the two programs to limit insurers’ losses and subsidize premiums.

With the government programs ending this year, insurers will either increase premiums to pass the financial costs onto patients or stop offering insurance plans to individuals all together, Kominski said.

“(What insurance companies mean is) we can’t make as much money as we’d like to,” Kominski said.

UC SHIP was created in 2010 to help students meet the UC Regents’ mandate that every student have adequate health insurance and ensures students satisfy the Affordable Care Act’s minimum standards for health insurance. About two-thirds of UCLA students enroll in UC SHIP each year, said UCLA spokesperson Rebecca Kendall in an email statement.

UC SHIP’s medical coverage is supported solely by the fees paid by students, according to the UC Office of the President. Fees for UC SHIP are likely to remain stable because young people do not have a large risk for health care costs, Kominski said.

For the 2016-2017 academic year, UC SHIP fees were about $2,100 for undergraduates and $3,600 for graduate students.