Why Colleges and Universities Should Offer Separate Health Insurance Programs for Domestic & International Students

Eric Edwards | 12-21-2016

As more students arrive from all corners of the globe, schools have found themselves in a position where they need acknowledge the unique needs of the entirety of the student body, both their domestic US students and their inbound international students—but they may not be sure of the best way to do that. For many institutions, the solution has been simply to lump international and domestic students together under one health insurance plan. However, that’s not always the best way to provide benefits for everyone. In fact, a best practice for schools is to offer separate health insurance plans for international and domestic students.

Different Backgrounds, Different Needs

It can be tempting to think that the best way to provide coverage to all students is simply to put everyone under the same insurance plan. This solution fails to recognize that international students, more often than not, have unique and different needs than domestic students. There are a multitude of benefits tailored specifically for international students that domestic students don’t need. For example, coverage for international students should consider emergency evacuation and repatriation services, as well as extended coverage beyond the academic year—benefits that policies for domestic students typically do not cover. If your school offers coverage that’s been designed with just the US domestic students in mind, chances are the needs of the international student demographic will not be met.

Navigating the System

The American healthcare system can be difficult for even domestic students and lifelong residents to navigate, so you might imagine that it can be particularly daunting to newcomers. Providing international students with a clear picture of how the US healthcare system works and how their specific health plan allows them to access care often presents a challenge for overworked student advisors. When coverage for international students is separated from benefits for domestic students, advisors can rely on the international student insurance provider to explain how everything fits together. Specialized international student health insurers can take the burden off of the advisors by providing in person orientations for new international students, where the complexity of the US healthcare system is broken down into easily understandable parts. A health program built for inbound international students will also provide 24/7 emergency services in all languages.

Exemptions from Law

International Students studying in the US have a five-year exemption from the Affordable Care Act’s (ACA) Individual Mandate requirements, with few exceptions. That means that a plan designed for international students doesn’t need to get tangled up in meeting the strict criteria the ACA sets out for plans covering US domestic students. This is a huge advantage for international students—they can be covered by plans that are crafted to meet their specific healthcare needs vs. lumping them into US style plans that are actually designed to cover employees, not students. Plans for the international student population can be more flexible, which allows a greater degree of latitude as you design coverage that accounts for the unique needs of students arriving from any number of places around the globe. It also means that plans tailored to international students can be much more affordable than plans design to comply with the ACA.

Savings for School and Student

Domestic student plans typically have higher claims than international students; that can artificially raise the cost of a benefits plan for the international student population. When the international students are grouped with the domestic students, premiums will average out higher—which means international students will end up paying more for coverage that they’re not using. Worse, this high-cost coverage designed to comply with the ACA will likely include higher deductibles, lower coinsurance amounts, higher out of pocket costs, and will lack the unique benefits required by international students.


When the benefits plan for international students is separated from that of the domestic students, serious savings can result. Since this demographic tends to claim less frequently, insurance rates will be more stable across the long term. More predictable rates mean better budgeting for schools and, often, lower premiums, which benefits both schools and students. Finally, the future of the ACA is extremely unpredictable at this time, and has already experienced substantial premium increase over the past several years. Schools that separate their coverage will shelter their international student benefits plan costs against ballooning premiums that are being experienced by US employees and students.

The Sum of It

With these considerations in hand, separating health insurance for international and domestic students is a clear choice for schools. Not only will you be able to offer more stable pricing, but you’ll also offer tailored coverage and support to your international students.

How to Evaluate International Student Health Insurance Options

Author: Eric Edwards