Graduate Student HealthOptions NOVEMBER 16, 2015

Creation of an employer group plan specifically for the tuition assistance graduate students ProCon Employer contributions would be allowed under ACA if we reclassified the graduate students as employees. Reclassification of tuition assistant graduates creates other issues in the areas of: Other benefits, Affordable Care Act (ACA) fees, tracking of hours, etc. Investigation is needed further to understand the total impact of moving these individuals from students to employees under the CRRs. Premiums payable per pay periodMay not meet ACA affordability test under ACA which may cause a penalty for employer. Cost can’t be more than 9.56% of the lowest paid employee (i.e. lowest paid employee x 9.56/12)*. An actuary would be required to run multiple tests Vision and dental could be offeredThe premiums on the small employer plan may be higher than on the student plan Equity issue: other part-time employees will want coverage – why just tuition assistance graduate students? Separate evacuation and repatriation plan required for international students Significant resources of the university and student population needed to design and approve plan, system builds and consulting fees required (minimum of 1 year to create with new FTE required) Large communication and education effort needed to explain graduate students their reclassification (and impact), new plan designs and premiums Increase to the campus benefit flat rate (this is the per dollar of salary rate charged to each campus for the cost of benefit plans) When tuition assistance ends, the student would have to move back to the student plan causing disruption meaning premium payment timing, deductibles start over and other met out of pockets start over HR Administration has not dealt with fiscal years or academic semesters (starts and stops)– eligibility for students would be administratively burdensome The cost of creating a plan for a small population may not be a cost effective solution for the university *see slide notes

Add the tuition assistance graduate student to the current employer plans ProCon Premiums payable per pay period (would end when employment ends). Reclassification of tuition assistant graduates creates other issues in the areas of: Other benefits, ACA fees, tracking of hours, etc. Investigation is needed further to understand the total impact of moving these individuals from students to employees under the CRRs. This increases choice for domestic students (International students would be tied to the current PPO) May not meet ACA affordability test under ACA which may cause a penalty for employer. Cost can’t be more than 9.56% of the lowest paid employee (i.e. lowest paid employee x 9.56/12)*. An actuary would be required to run multiple tests Vision and dental could be offeredPremium increase to student (grouped with aged population) Employer contributions would be allowed under ACAEquity issue: other part-time employees will want coverage and question why just tuition assistance graduate students receive the benefit Separate evacuation and repatriation plan required for international students Large communication and education effort needed Impact on the campus benefit flat rate (what each campus is charged for benefits) If employer plan increases deductibles, international students would no longer qualify and move back to the student plan causing disruption (premium payment timing changes, deductibles start over and other out of pocket costs start over) Loss of plan design preferences because grouped with larger population (fully insured to self insured) Premiums, deductibles, copayments, coinsurance, and out of pocket maximums are now tied to a larger group and are impacted by the shift in plan designs due to increasing costs of the plans When tuition assistance ends, the student would have to move back to the student plan causing disruption meaning premium payment timing, deductibles start over and other met out of pockets start over

Develop a graduate student private employer exchange ProCon Defined employer contribution – there is a fixed dollar stipend (renewal based on experience) amount you would give each employee and they would go out on the exchange Reclassification of tuition assistant graduates creates other issues in the areas of: Life, LTD, ACA fees, tracking of hours, etc. Investigation is needed further to understand the total impact of moving these individuals from students to employees under the CRRs. Number of health insurance options available to the graduate student are greater May not meet ACA affordability test under ACA which may cause a penalty for employer. Cost can’t be more than 9.56% of the lowest paid employee (i.e. lowest paid employee x 9.56/12)*. An actuary would be required to run multiple tests International students would qualify if separate evacuation and repatriation plan is purchased and deductible is a maximum of $500 Small pool for underwriting (pricing) and large claims will impact the group. Ease of administration (online) and decision support technology to assist in decision making Separate Evacuation and Repatriation plan required for purchase for international students Premium billed monthlyUnknown if cost is less than student plan for student or university due to the requirement of the $500 for international. Costs are higher with a lower deductible. Dental can be offered through the exchangeRequest for proposal process, implementation time needed as there are over 200 private exchanges varying in plan design Communication and education effort considerable – 1 year to build and to implement (i.e. 8 plans offered and decide which to offer) When tuition assistance ends, the student would have to move back to the student plan causing disruption meaning premium payment timing, deductibles start over and other met out of pockets start over

Public Exchange ProCon Defined employer contribution – there is a fixed dollar stipend (renewal based on experience) amount you would give each employee and they would go out on the exchange Some international students may not qualify for the public exchange (may not have met residence requirements or visa) International students would qualify if separate evacuation and repatriation plan is offered and deductible is not over $500 Purchase of separate evacuation and repatriation plan needed – International students could stay on the student plan without a subsidy (no tie to insurance) Some students would qualify for the marketplace federal subsidy while others may not Communication and education effort considerable Students could pay monthly premiumUnknown if cost is less than student plan for student or university due to the requirement of the $500 for international Dental plans are offered through the exchange if you purchase medical coverage Benefit levels are significantly different from the current student plan Ease of administration and no adjustment needed for graduate student hours Administration and tracking of international students choosing the exchange versus student coverage Choice of plans (Platinum, Gold, Silver, Bronze)When tuition assistance ends, the student would have to move back to the student plan causing disruption meaning premium payment timing, deductibles start over and other met out of pockets start over By moving all students or graduate students to the public exchange, may have a negative impact on image (moving them out of the plan) What if international purchases large deductible plan (i.e. $5,000) and has a serious illness Loss of negotiation over plan design changes and costs so a defined contribution plan may need to be the same for everyone (domestic and international) A shift of 10% or more from the student plan would be considered a material change and require a review of the rates charged for the student plan.

Graduate Student Non-insurance Options OCTOBER 20, 2015

Non-insurance option: increase student stipend – spread across all tuition assistant graduate students ProCon Student requested increase in stipend so this meets a request Increase of spending cost to the university Uncoupled from insurance those who want to choose to go to public market may win due to subsidy received from the exchange due to income. No effort to change the current student options Some students would qualify for subsidy and student may not need to change if unrelated general stipend to insurance Administration of obtaining payments from students. No adjustment needed to the Collected Rules and Regulations for graduate student hours Vision and dental remain unchanged Coverage beyond the Custom 9 county area and access the same The shift in population for those who do not take the student plan could result in a premium change from the current insurance carrier. Student plan already includes evacuation and repatriation plan Ease of implementation and administration (same) Could build a payment plan through the cashiers office to meet the payment needed

Spread stipend across all tuition assistance graduate students, add silver option, remove insurance requirement ProCon Premium cost to the student The silver plan may not meet all of the international student needs Premium cost to the universitySilver plan does not offer the same level of coverage as the current plan (out of pocket costs for coinsurance, copays and deductibles may be greater) Offering choice of health insurance plan options for the student The estimated 7-10% savings to offering a silver plan does not make up the delta for spreading the funds across the remaining tuition assistance group. Graduate students are familiar with the student planDental and vision plan not offered (discounts only) Fulfills the ACA requirement if we remove the insurance requirement Only a few payment options available (could create a process through cashiers to see if other options are available – increases administrative burden) Fulfills the HR requirement (less than 28 hours)Stipend amount for domestics and international students may be the same as there is no longer a tie to insurance, thus increasing the amount put into the stipend (discriminatory). Could still be based on.25 or.50 Access to care and flexibility for dependent coverage is consistent with what the student currently experiences If students receive the stipend and choose not to purchase the student plan, the shift in number of insured may change the costs the insuring company charges Domestic students who stays on their parent’s plan will see an increase in income (due to funds no longer being tied to insurance) Students believe insurance should be covered. With the spread of the dollars to all graduate students, the amount the tuition assistant graduate receives is now less International student amount would increase to bring them to the level of domestics (due to funds no longer being spent on insurance). Some students may choose the silver plan due to the cost differential and not realize they are paying incrased deductibles, copays and coinsurance thus increasing their out of pocket costs

Non-insurance option: Create a fellowship provided to all tuition assistance graduate students and keep group on the student plan ProCon Separates pay from health care and the student can use the funds however they want Could be viewed by the IRS as moving the money to pay insurance under another vehicle (if it is taxed and offered to everyone then this should be acceptable but would require legal review The Office of Student Financial Student Aid and the Cashier’s office can manage and the fellowship could be paid in a lump sum (i.e. prior to each semester) University cost is greater because the fellowship would be offered to all students with assistantships, regardless if they plan to use it for insurance Fellow payment aligns with academic period; therefore, the fellowship payments will be disbursed with financial aid prior to the start of the fall and the spring semesters Students not taking the student plan may impact rates under the current student plan There is no added expense to the student if they choose to purchase insurance Assistantships with tuition waivers should be established prior to aid disbursement Each category of students (.25FTE,.50FTE, Domestic and International students) can have a separate fellowship that matches the cost of insurance May not be able to raise cost of living to the same amount as to the cost of insurance The fellowship is taxed. The students are required to report the fellowship on their taxes