Dive Brief:
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A number of universities have dropped or are re-evaluating programs to help graduate students pay for health insurance coverage in response to new guidance from the IRS.
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The guidance says the methods of many universities do not comply with the ACA, because IRS classifies graduate students who serve as teachers and research assistants as employees of the university. The law does not allow businesses to give subsidies to employees to purchase individual health insurance.
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The issue came to a head at the University of Missouri, where administrators backtracked last week on a decision to cut subsidies after their graduate students threatened a walkout and Sen. Claire McCaskill (D) stepped in to urge a solution. The university has decided to defer the decision for another year.
Dive Insight:
The issue puts both university officials and graduate students in a bind, particularly because health insurance is mandatory for many graduate students, and because the events at the University of Missouri has put the issue on the national radar.
As a result, groups that represent colleges and graduate students are working to move the IRS and HHS to reconsider their interpretations of the ACA for universities.
In the meantime, numerous schools, such as the University of Georgia, are in limbo, Kristofferson Culmer, president and CEO of the National Association of Graduate-Professional Students, told the Athens Banner-Herald.
“It seems like a lot of universities are sitting back and waiting to see what the IRS will do,” he said.