State legislators in Michigan were outraged over Michigan State University’s rule that undergraduates have health insurance. So they forced the university to scrap that requirement in order to receive extra state money.
The state budget, recently passed by the Legislature, bars Michigan State from mandating health insurance if the institution is to qualify for a small increase in state appropriations—one of several restrictions that legislators placed on public universities over social or ideological issues.
But if lawmakers thought they were putting an end to a policy that was causing financial hardship for thousands of students, they were wrong.
In the past, about 85 percent of students arrived on the campus already insured, said Lou Anna K. Simon, president of Michigan State. And after the university helped most of the uninsured find coverage, only about 600 students were left without insurance, Ms. Simon said.
Under Michigan State’s policy, enacted in the fall of 2011, those 600 students were charged $1,500 for health insurance through a university plan.
The measure was meant to prevent students from incurring a costly medical bill that could force them to drop out of college, Ms. Simon said.
Other universities, especially those with hospitals, are able to treat students and write off the cost, she said, but Michigan State does not have an affiliated hospital.
Such a policy is not unique to Michigan State. Nearly every private college in the state has a similar requirement, but will not face any punishment from the state.
Michigan State was singled out for its insurance mandate because one of the 600 students who was billed for insurance was the son of a lawmaker, Rep. Jeff Farrington, a Republican. His son had insurance but had not informed the university. Representative Farrington was instrumental in placing the restriction on Michigan State’s insurance requirement, according to several sources.
Mr. Farrington said his only role in promoting the measure was to pass it on to prominent members of the Appropriations Committee—the lawmakers who shape the chamber’s state-budget legislation.
While no details have been finalized, Ms. Simon said the issue “will be taken care of.” One option, she said, was to give students the option of declining the university’s insurance coverage and not automatically billing those students who are not covered by another plan.
