MU cuts health insurance subsidies for graduate student employees

The University of Missouri will no longer provide health insurance subsidies to graduate students who are employed by the school.

The university said in a memo to graduate students on Aug. 14 that it is cutting the assistance because the Affordable Care Act prohibits businesses from providing subsidies for employees to purchase “individual market plans.” MU would face “significant” fines for violating that ban, the school said.

In Fiscal Year 2015, more than 3,000 students received the subsidies, at a cost of almost $4 million to the university.

R. Bowen Loftin, University of Missouri chancellor | Photo courtesy of University of Missouri News Bureau
R. Bowen Loftin | Courtesy of the University of Missouri News Bureau

Students received the news less than two weeks before the start of the fall semester. MU became aware of the issue on July 21, according to another memo sent to students, but school officials hoped the Internal Revenue Service would make an exception for graduate employees.

The IRS instituted the fines to discourage businesses from avoiding employer-sponsored health insurance plans, which are mandated by the Affordable Care Act.

To help students cope with the short notice, MU is offering a one-time stipend. Domestic students on assistantships or fellowships will receive up to $1,240, and international students will receive up to $709 — both enough to cover the cost of Aetna insurance for the fall semester. Aetna’s full-year plans cost $3,051 for domestic students and $1,685 for international students.

MU Chancellor R. Bowen Loftin apologized for the situation Monday in a letter addressed to university employees and graduate students. He also announced the formation of a task force to “research and propose solutions for providing affordable insurance to our graduate students.”

In past years, the MU Office of Research and Graduate Studies offered an insurance subsidy, along with tuition benefits, to assistants who worked 10 or 20 hours per week for the university.

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