Iowa public universities owe millions to insurance company

college student health insurance accident

The post secondary institutions have refused to pay for a health plan subsidy program but they still owe the money.

Public universities in Iowa have been standing their ground and refusing to pay an insurance company millions of dollars in fees which would cover a program meant to provide residents with medical risks with a subsidy for their health plans.

The universities had been billed for the fees but until now have refused to fork over the money for it.

That said, the Iowa Supreme Court recently ruled that the Iowa Individual Health Benefit Reinsurance Association is within its rights to take the universities to court in order to attempt to collect the fees that have been left unpaid. Last year, an appeals court had determined that the association was not within its power to sue the universities in order to have them pay the fees to the insurance company. However, this most recent decision overturned that ruling from the appeals court.

The insurance company is arguing that the universities must be treated the same way as all state agencies.

college student health insurance accidentOther state agencies as well as municipalities and school districts that have health insurance plans that are self-funded are considered members with the insurance company and have a requirement to pay for having annual assessments conducted on their behalf.

The school districts and public universities have been agreeing to pay those fees for years. That said, in 2010, the University of Iowa changed the game by deciding to self-insure. All three of the state’s public universities therefore contend that the law requiring them to pay for the assessments no longer applied to them as they were providing their own coverage from that point forward.

For that reason, the universities stopped paying the insurance company for the assessment fee because they stated that it was not required as they were self-insured. Still, the assessments were conducted as has always been the case, and the bills continued to be issued to the universities. It is now more than likely that the universities will be taken to court in an attempt by the insurers to receive payment for those fees.

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