corrupt practices, higher ed corruption
Lauren Victoria Burke/AP
New York Attorney General Andrew Cuomo

Georgetown Subpoenaed by NY’s Andrew Cuomo Over Health Care

November 20, 2008 11:55 AM
by Jen O'Neill
New York Attorney General Andrew Cuomo subpoenaed Georgetown University over suspicion that the school was profiting by forcing students to join a specific health care plan.

Student Health Care

Georgetown University received a subpoena and documentation request this month from New York Attorney General Andrew Cuomo, as part of a larger investigation into the associations between higher education institutions and the health insurance companies that cover students, The Washington Post reports.

The focus of the investigation is on whether full disclosure of policy terms and costs are being conveyed to students. Furthermore, the probe is looking at any improper payments received by colleges, and to see if  “[s]chool officials could be steering students to providers and getting payments in return.” The investigation began after families questioned college policies that require students to purchase health care plans from the college, regardless of whether they are covered by their parents’ plans. 

According to The Washington Post, “The questions arise at a time when advocates are pushing for more coverage for students.”

Julie Bataille, Georgetown spokeswoman, announced that the school will determine the “appropriate response” reviewing the subpoena.

Bataille points out that as per the school’s Web site, Georgetown uses United Healthcare’s “premier plan,” where students are charged annually, with the option to continue or discontinue the plan during the open-enrollment periods.

Opinion & Analysis: Too much red tape?

“Given tightened state budgets stemming from a deteriorating economy, public colleges and universities face unprecedented financial challenges,” John Englund explains in his article, “The Economy and College Student Health” from the publication Inside Higher Ed. He continues, “The financial challenges facing public colleges and universities have been accentuated during this recent market meltdown.” According to Englund, since 2000 health care costs have increased close to 10 percent a year, and as a result, many colleges and universities continue to require students to pay student health center fees.

“Colleges need to use their purchasing power to negotiate better deals,” Englund states. He suggests that one possible solution to the problem is for colleges to more willingly accept the family’s health plan; the other solution is to reach a deal with private insurance companies for students who do not have access to health care under family plans.

However, the article indicates that many larger colleges are less likely to accept family coverage because of the administrative costs associated with the paperwork required to file insurance claims. Furthermore, “Many doctors and nurses are attracted to college health centers because they can avoid some of these ‘headaches’ and focus exclusively on providing care,” the article states.

Related Topics: A chance to earn an extra dime

The investigation mirrors one conducted in May 2007, when Andrew Cuomo uncovered fraudulent lending practices, where many colleges received payments from individual lenders, based upon how much students borrowed from that lender, and in turn gave colleges an incentive to steer students toward certain loan companies. In other cases, it was determined that some financial aid officers owned stock in the lending companies they referred students to, in which Cuomo stated, “We believe these revenue-sharing agreements are really no different than kickbacks.”

Andrew Cuomo’s crackdown on the student lending industry determined that there was a conflict of interest in lending practices, and as a response, the Attorney General’s Office developed a code of conduct that forbade such practices. The Student Lending Accountability, Transparency, and Enforcement Act, aka the SLATE Act, was enacted for New York state and “serves as the basis for a new federal law, The Higher Education Opportunity Act of 2008.” The Office of the Attorney General aims to ensure “student’s rights are protected nationwide wherever they go to school.”

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