On the NPCs, it asks to list medical expenses not covered by insurance. Would this include the cost of the insurance itself? Thanks.
No, it does not include the insurance premiums.
That seems weird because we could buy cheaper insurance with a higher deductible and then have higher medical expenses. It seems like it would all be one bucket of healthcare expense. Are you positive about this?
Do you pay the premiums through an employer health insurance plan?
Those occasional medical expenses wouldn’t impact anything --they will make considerations for unusual high expenses that have impact. The price of a high deductible or two isn’t going to affect your aid, but if you wish to change insurance in hopes of getting something out of it, that’s your call.
No, we pay out of pocket. Our premiums are very high. When I add those into the NPC it changes our aid significantly.
I was told by the financial aid representative at the parent information session at one highly selective college that if you pay out of pocket, with post-tax dollars, for your medical insurance premium, since you are allowed to deduct them as well as any claims incurred that are not covered by insurance, from your taxable income if they exceed 7% of your gross, then you can also deduct them from earnings when you complete the NPC.
But since most people are covered by employer provided benefit plans, any employee share of the premium is usually paid with pre-tax dollars under a Section 125 Plan, these people cannot deduct their premium for the NPC purposes.
Personally, we fall into this latter category, but we have a high deductible plan with a very high out-of-pocket max, and due to my medical conditions, we always have these high expenses not covered by our insurance. We are able to deduct these claims from the NPC but we do not reflect the employee share of the premium.
My recommendation for anyone is to check with the school’s FA dept if there is any question on how to fill in the NPC tools.
Don’t take tax advice from financial aid counselors.
^ Or FA advice from tax people.