Common Questions: Is the Affordable Care Act Suitable for International Students?

The Affordable Care Act – also referred to as ACA, Obamacare, or PPACA – has now been around for over a decade having been signed into law by former President Obama on March 23, 2010. The ACA required US citizens and permanent residents to maintain “minimum essential healthcare coverage” or be subject to pay a fine when paying taxes to the International Revenue Service (IRS). This fine has since been eliminated in many cases but it changed the landscape of the way that US insurance companies did and continue to do business.

While the initial intent of the bill was to expand coverage to US citizens, there were questions surrounding its impact on international students, scholars, and other populations. Now, having been in existence for a while, there is a lot of clarity about what school and student responsibilities are. In this blog, we will examine some popular questions regarding ACA coverage.

Does the ACA apply to international students?

If a student is holding an F, J, M, or Q visa in the U.S., they are considered a non-resident alien for tax purposes for the first 5 years and are exempt from the mandate. There is no insurance requirement for F1 students, and it is up to the school to determine what the requirements are.

Does the ACA apply to J visa holders similarly?

Similar to the requirement for F visa holders, any J visa holder who is a non-resident for tax purposes is also exempt from the ACA. But, unlike F1 visa holders who have no federal requirements, the Department of State does require that all J1 and J2 visa holders maintain a certain level of insurance requirements while in the US at all times (which is significantly less than what the ACA requires).

How are schools navigating their group insurance plan for students?

Many schools throughout the US do require some level of health insurance; however that can vary by school. The most common ways to administer a school’s insurance plan includes:

A group plan just for international students (which may or may not include scholars)
A group plan for all students, including US and international students
No group plan, but may require all students to enroll in an individual plan that meets certain requirements

While the way in which insurance is administered can vary school by school, it is important that all international students carry some insurance while they are in the US. It can be challenging to explain how expensive the healthcare system in the US is and how there is no national or universal healthcare system.

What does an ACA compliant plan mean?

An ACA compliant group plan is often found on college campuses when both domestic and international students are on one plan, but it doesn’t have to be. ACA coverage requires the plan to be filed in that state and to also meet the “minimum essential healthcare coverage”. The 10 benefit requirements are:

Ambulatory patient services (outpatient care you get without being admitted to a hospital)
Emergency services
Hospitalization (like surgery and overnight stays)
Pregnancy, maternity, and newborn care (both before and after birth)
Mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy)
Prescription drugs
Rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills)
Laboratory services
Preventive and wellness services and chronic disease management
Pediatric services, including oral and vision care (but adult dental and vision coverage aren’t essential health benefits)

In addition to these 10 requirements, these plans are also required to include coverage for both birth control (https://www.healthcare.gov/coverage/birth-control-benefits/) and breastfeeding (https://www.healthcare.gov/coverage/breast-feeding-benefits/). These plans must also provide unlimited coverage, pre-existing coverage from day one, including wellness, and maternity must be covered the same as any other illness.

Due to rising costs, many schools have decided to look at alternate options since prices are on the rise and students struggle to afford to pay the high costs. And since international students and scholars don’t need ACA compliant coverage, schools have more flexibility to build a plan more in line with the needs of international students, both in terms of budget and benefits.

What does it mean if I don’t have an ACA compliant plan?

Many schools and students have been questioning how essential an ACA compliant plan is as the costs are often thousands and thousands of dollars every year. But schools may appreciate the comprehensive benefits an ACA plan might bring.

For plans that are not ACA, you can customize the plan specifically to meet the unique needs of your international student population (which may or may not include those essential benefits discussed above). This means you can still have unlimited coverage, if you think that’s appropriate – or you can have wellness included. However, you do not have to. By being able to customize your plan, you can get the benefits you want with more flexibility to customize the plan.

What are the advantages of a non-ACA plan?

A non-ACA plan allows you to customize your insurance plan based on the benefits you need. Many times these carriers are more in tune with the unique needs of your student or scholar population and may also include:

Emergency medical evacuation – required on a J visa!
Repatriation of remains – required on a J visa!
Emergency reunion
24-7 multilingual travel assistance

You will also find that these plans are much less expensive and have a lower out of pocket cost (the deductible, copays and coinsurance tend to be lower) when students use the plan.

It is important no matter the plan, that you understand what it does and doesn’t cover. Reviewing the master policy is essential to understanding your policy. Ask for it and do not rely solely on the brochure. Once reviewing this document, carefully review the exclusions to know what is and what isn’t covered.

What questions should you ask about your insurance proposal?

If you are reviewing an insurance plan, it’s important to review the policy in full and know what it does and doesn’t cover. Questions you can ask include:

Provider Network – How much do you pay inside and outside the network? Are there providers nearby and what does the claim process look like?
Coverage Area – Where are my students covered (in the state, throughout the US, or outside the student’s home country?)?
Insurer – Who is insuring the plan and what is their rating by A.M. Best or Standard and Poor’s?
Claims – Where are the claims processed? How long should it take? Is there a way for students to follow up on their claim? Is it by reimbursement or will it be paid directly to the provider?
Benefits and Exclusions – Look through the policy and be sure to understand the benefits and exclusions to understand how your policy will be paying out claims. When in doubt, ask!

If you or your organization is looking at group plan options, our team would be happy to help provide you with a customized proposal for your school. To get started, please request a quote and our University Relations Team will be in touch with you shortly.