Optimizing Insurance Solutions and Reducing Costs for University Athletic Department

Issue

A private university with over 15 athletic programs faced rising premiums on its secondary sports accident insurance, which was significantly impacting its budget.

Key challenges included:

• Increasing premiums on secondary sports accident insurance year over year
• Limited coverage for international student-athletes, leaving gaps in their healthcare benefits
• The high cost of premiums that exceeded the value of the benefits provided
• A lack of financial sustainability in the department’s insurance model, with escalating costs leading to reduced resources for student-athletes

Solution

To tackle these challenges, we implemented acomprehensive, long-term strategy designed to reduce insurance costs and improve coverage.

Our key strategies included:

• Mandating Primary Insurance for every student-athlete, ensuring that more costs were covered by their primary insurance and reducing reliance on secondary insurance
• Implementing a school-sponsored international student health insurance plan that meets U.S. Visa requirements and covers sports-related injuries
• Introducing a student fee to offset the costs of secondary sports accident insurance premiums, ensuring financial sustainability while maintaining necessary coverage
• Establishing a system to verify the primary insurance for all student-athletes, ensuring it was valid and adequate for athletic-related injuries

Outcome

Over an 8-year period, the university achieved significant reductions in its secondary sports accident insurance premiums, as well as improvements in the student-athlete experience:

• The claims experience on secondary insurance drastically reduced – from over $300,000 in the first year to just under$75,000 by year 8
• The annual maximum cost of the secondary sports accident policy decreased from over $400,000 to approximately $150,000
• More primary insurance coverage meant secondary insurance paid less, leading to reduced premiums and improved cost control
• International student-athletes now had comprehensive coverage for sports-related injuries and non-athletic sicknesses, enhancing their access to healthcare
• The streamlined process reduced administrative burdens, with claims handled more efficiently, ensuring quicker payments
• With the introduction of a student fee, the department’s budget remained stable, while ensuring continued, high-quality coverage for all student athletes

With strategic adjustments, the university’s athletic department was able to reduce costs while enhancing benefits for student-athletes and staff, resulting in a sustainable and effective insurance model.

To ensure continued success, we meet with the sports medicine staff at least once each semester to review claims procedures and provide updates to the administration on paid claims status. This proactive engagement ensures that the department stays informed and that the insurance plan remains efficient.