<p>Personally, I haven't bought any tuition refund insurance yet, but I might if the cost were reduced to only a couple hundred bucks, which this article seems to suggest might be feasible for a policy covering only withdrawal due to accident and acute illness. I feel confident enough that my two children would not need to withdraw for mental health issues that I would be willing to take the risk of not covering that while protecting us from the loss in what to me is the more likely scenario of sudden physical illness.</p>
<p>I am assuming here that more health withdrawals from college are due to psychological illnesses and therefore make up the bulk of the current premium cost based on Sallie May's argument that the pay out needs to be differentiated to keep costs down.</p>
<p>I understand the parity issue in health insurance coverage for mental health and am all for all-inclusive (and obligatory) coverage. But this is a little different as it is totally optional. Should insurers be allowed to differentiate refund amounts as Sally Mae is doing? Should there be different options for coverage in the policies offered?</p>
<p>I think it’s reasonable for insurers offering this type of coverage to charge more for policies that are more likely to have claims made upon them. This isn’t an issue of access to medical treatment; it’s more like car insurance. In the case of car insurance, if you are statistically more likely to file a claim, you pay more. Parents of teenage boys pay more than parents of teenage girls, regardless of personal history. Similarly, those who have been diagnosed with mental illness in high school or earlier may be more likely, statistically, to withdraw from school than those who have not been diagnosed. The individual case may be different but insurance premiums are set by actuaries who look at statistics. We can’t expect insurance companies to disregard this information when pricing their product. Again, the issue is not access to medical treatment. This is protection against a freely incurred financial risk: that your kid might drop out of college.</p>
<p>Wildwood11, I caution you against thinking mental illness could not strike your children. My son was struck with a severe mental illness this year, as a college freshamn. If you had asked me before it happened, I would have told you he was the LAST person who would become ill. He was the happiest, most enthusiastic and productive boy you’d be likely to meet. From talking to parents of other college students, it is my definite impression that kids this age are more likely to be hit by mental illness than other catastrophic illnesses. I know several students who have been brought home just this year by their parents because their mental illness prevented them from continuing in school.</p>
I think this would be problematic because there might not be enough spreading of risk for the policy with the mental health coverage. Making mental health coverage optional might trigger a positive feedback loop where only families at high risk opt for the more expensive insurance, which forces the premiums up, which causes even fewer families to purchase the insurance. </p>
<p>You wouldn’t want to make health insurance maternity benefits optional either. Who’d be left to pay for it?</p>
<p>I agree that the risk should be shared by the larger pool, and no distinction should be made between premiums or coverage for physical versus mental health illness.</p>
<p>Following the above logic, should families of kids with chronic medical conditions pay more too?</p>