GRADUATE INSURANCE PLAN RESTORED

November 9, 2009

Dear Graduate Community:

In August, the University of Georgia’s Graduate Student Association (GSA) learned that the Board of Regents increased the out-of-pocket maximum from $2,500 to $10,000 and decreased the maximum dependent benefit from $300,000 to $50,000 in the mandatory student health insurance plans, in order to preserve the policy’s premium.

Based upon our research, an in-network out-of-pocket maximum of $2,500 is in line with our peer and aspirant institutions. Of the 18 peer or aspirant institutions for which we could obtain data, the mean out-of-pocket maximum is $2091.67 and the standard deviation is $1074.33. The range of our data is $4100.  Essentially, an in-network out-of-pocket maximum of $10,000 is twice that of any in-network out-of-pocket maximum at any peer or aspirant institution for which we were able to obtain data. 

I believe that reducing the out-of-pocket maximum will restore equity to the graduate insurance policy by ensuring that no small group of students suffers in order to keep the insurance costs artificially low.  In addition, the lower out-of-pocket maximum will restore our competitiveness with peer and aspirant institutions, based upon our data.

After assessing our position relative to that of our peers, GSA surveyed UGA graduate students and asked if they would support implanting a rider that would reduce the out-of-pocket maximum from $10,000 to $2,500, provided that it was subsidized by the University at 40 percent (for students eligible for the cost share).  In the survey, we had 1142 respondents; 1028 students or 89.78 percent were in favor of an increase in their premium in order to reduce the out-of-pocket maximum from $2,500 to $10,000.  117 students or 10.22 percent remained opposed to the rider as proposed. 

In response, GSA and the UGA administration worked with the Regents office and the insurance provider Pearce & Pearce to address this issue.  The Graduate Student Association strongly supports the addition of the proposed rider, which will reduce the out-of-pocket maximum from $10,000 to $2,500. 

Based upon our recommendation, the Board of Regents and President Adams have approved the rider. This program will cost each student $86 ($51.60 for students eligible for the 40% University cost share) for spring semester, and the out-of-pocket maximum on the mandatory plan will be reduced back down to $2,500. Beginning in January 2010, students who have health premiums charged to their student accounts will pay for the rider in the same way.  Students who qualify for the UGA cost share will pay for the rider in three equal payroll deductions of $17.20 in February, March, and April, 2010.  In addition, if you incurred expenses in excess of your out-of-pocket maximum during the fall semester and you are enrolled for fall 2009 and spring 2010, Pearce and Pearce will refund those expenses that exceeded the $2,500 out-of-pocket maximum, dating back to August 1, 2009.  If you are not enrolled in the mandatory plan for spring semester 2010, this rider does not apply to you.

You should soon receive more information about health insurance enrollment from UGA’s Human Resources Department.  If you have any questions, please contact me at gsa@uga.edu.

Very respectfully,

                                                        Graduate Student Association