Colleges getting out of health insurance business

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SEATTLE (AP) — The federal health care overhaul is leading some colleges and universities to get out of the health insurance business.

Experts are divided on whether this change will be good or bad for students. Some call it an inevitable result of health care reform and a money-saver for students since insurance in the marketplace is usually cheaper than the college plans. Others worry that more students will go without health insurance since their premiums won’t be folded into the lump sum they pay for school.

The main driver of colleges getting out of the insurance business is a provision in the Affordable Care Act that prevents students from using premium tax subsidies to purchase insurance from their college or university.

As more states expand Medicaid eligibility it’s likely more colleges will push their students into the marketplace – a development being seen from coast to coast.

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