Health care becomes law, affects students

The Health Care and Education Affordability Reconciliation Act that President Obama signed into law on March 20 will affect students in several ways.

UW-River Falls Professor Brian Copp explained this bill in simplified terms.

“Health insurance should become available to all students who are presently not insured,” Copp said. “In the past, once a student graduated, they fell off their parents family insurance coverage; now a child can remain under their parents plan through age 26 whether they are a student or not.”

He explained that this was already law in both Wisconsin and Minnesota for the past couple of years.

This new bill doesn’t just affect students’ health insurance, but it also affects student loans and the way the process goes.

“The legislation should free up money authorized in spending bills that formerly went to banks in fees and put it directly into aid to the students for which it was intended,” Copp said.

Barbara Stinson, director of financial aid, explained how this will affect UWRF students.

“It isn’t going to be as pertinent for new students (incoming freshman) because it won’t be a change for them,” Stinson said.

“Our audience of concern is the continuing student; I’m not concerned that students will be lost, but they will be the ones that will see change.”

Stinson explained what will happen with student debt.

“The average student debt in this country is $23,000,” Stinson said. “In the new law, by the year 2014, student loan repayments will no longer be able to exceed 10% of a student’s income.”

She explained that for an undergraduate at River Falls, this shouldn’t be a problem.

“What will affect students here at River Falls is that private banks will no longer be the middle man in their loans,” Stinson said. “Private banks have fees for that, and any student who did a loan application for going to school saw that they had to pay fees and they had to choose their own lender.”

There will be one main change that students and families need to make sure they complete.

“All students need to sign a new Master Promissory Note [MPN] if and when they accept a new Stafford Loan award,” Stinson said. “Detailed directions will be presented to students online as they accept their financial aid awards.”

Another change that will be implemented within this new law is that more students will be eligible for the Pell Grant.

“The maximum Expected Family Contribution [EFC] for Pell Grant eligibility for the 2010-2011 year is now increased to 5,273 from 4,617 as the maximum EFC for Pell Grant eligibility,” Stinson explained.

“In other words, more students will now be eligible for the Pell Grant; this is good news for many of our students.”

With the Reconciliation Act, students will no longer have to choose their own lender; they will be set up through the government.

In a video on WhiteHouse.gov/studentaid, Dr. Jill Biden, wife of Vice President Joe Biden, explains some of her opinions about the bill.

“No family should have to take on crushing debt to put their kids through college,” Biden said.

She went on to explain some specifics about the bill.

“First, the new law invests more than $40 billion in Pell Grants, and these awards will increase over time to help keep pace with the rising cost of college,” Biden said. “Beginning in 2014, students can limit their payments to 10 percent of their income, with any remaining balance forgiven after 20 years.”

Biden said that students could visit Studentaid.ed.gov for more information.

According to The Signal News, the Congressional Budget Office estimates that the bill will cost $940 billion in the first 10 years.

According to an article on the Web site, “It will help close the deficit by $130 billion over the first 10 years and $1.2 trillion over the second 10 years. Other estimates conclude that the bill will save even more over its first two decades.”

Jeffrey Hoffelt, a graduating senior at UWRF, explained what he knows about the new bill.

“From what I’ve heard about the bill, it sounds like it would have been helpful to have its benefits during my time at River Falls,” Hoffelt said. “Looking for private loans and insurance are unnecessary stresses for student.”

Cortney Cadwell, a freshman at UWRF, will have this opportunity to take out student loans from the government since she will be continuing her education next year.

“I guess it’s a good thing,” Cadwell said. “It’s easier to get a loan and you won’t have to pay extra fees. I don’t really know a lot about it because I don’t have any loans - not yet anyway.”
Mallory Aukes, another graduating senior at UWRF, gave her viewpoints on the bill.

“It would have been nice if the loans were available to me when I started college,” Aukes said. “I have had to take out loans for everything during my college career and will be in a great amount of debt when I am done, but this is what I had planned for.”

Aukes also explained that she is up in the air about the new insurance law.

“I don’t feel like I would have had to or will have to stay on my parents’ health insurance for that long because I hope to find a job within a reasonable time after college that will offer me this benefit,” Aukes said.

“I don’t want to be dependent on my parents once I am done with college ,and think that I should have the responsibility of finding a job and getting my own health insurance.”

She also explained that she feels it is not necessarily a bad thing to stay on parents’ health insurance.

“I’m not saying it’s a bad thing ... it would be nice to receive all the help I could get, but I just don’t think that it will really have an impact on me either way because I want to find a job that offers health insurance.”

Stinson explained that students really need to know what is going on with this new bill.

“This is more important than ever,” Stinson said, “that students read the fine print that they don’t want to read.”