≡ Menu

Making Women Pay More: Gender Rating and the Individual Market

As a nation, we’ve made great strides to ban gender discrimination and to guarantee equality under the law for both men and women.

Women are able to vote, own property, run a business, and adopt children.

And as the presidential campaign of Secretary of State Hillary Rodham Clinton showed, it is increasingly possible for women to do anything that men might do.

But when it comes to the individual insurance market, women still face discrimination.

Women pay significantly higher premiums than men (at least until the age of 55) for insurance plans sold on the individual market.

The National Women’s Law Center (NWLC) recently examined 3,500 health insurance policies and found that:

25 year-old women pay between 6% and 45% more than 25 year-old men;
40 year-old women pay from 4% to 48% more than 40 year-old men;
55 year-old women pay between 22% less to 37% more than 55 year-old men.

For example:

A 30-year-old woman in Columbus, Ohio, pays 49% more — $92.87 monthly compared to $62.30 for a man — for Anthem’s Blue Access Economy plan. For Humana’s Portrait plan, women pay 31% more than men in Denver or Chicago, and 32% more in Tallahassee, Florida.

Until recently, only 7% of women have been covered by individual insurance policies, and so this issue, while important, has not received much media attention.

But now that folks are losing their jobs and their health benefits, women are forced to turn to the private market to get care. The higher insurance rates charged for women are a significant obstacle to their accessing care.

And some politicians and employers want to move away from the favorable tax treatment of employer-sponsored coverage. They propose giving tax credits to individuals so that people can obtain insurance plans on their own.

Before advocating that we send more people to the individual insurance market, lawmakers should consider that:

Obtaining insurance on the individual market is a very difficult task.

  • When employers purchase coverage for their employees, the medical risks and costs are spread throughout the group, which helps to keep the insurance policies affordable for everyone.
  • In contrast, folks looking for coverage on the individual, private market must purchase plans directly from insurers. These plans are more expensive and offer fewer benefits.
  • Insurance companies also work actively to prevent individuals who may have higher medical costs than their peers from buying coverage.
  • Unlike employer-sponsored health insurance, individual policies are not well-regulated by the states or by the federal government.

    This means that insurers may refuse to provide coverage based on a number of criteria, including age, gender, and “health history”– whether or not an individual has a pre-existing condition.

    A pre-existing condition is generally defined to be any medical condition that existed before a person applied for health coverage.

    Insurance companies are known for using both long-term, pre-existing conditions like diabetes and relatively minor ailments like migraine headaches to deny individuals coverage.

    • There are a number of pre-existing conditions that apply specifically to women.

    Women who are already pregnant, or who have undergone a Caesarean-section (C-section) in the past usually cannot purchase individual insurance coverage.

    Survivors of domestic violence may also be legally denied coverage in 9 states and Washington, D.C.

    Women pay more for comprehensive care.

  • In addition to paying higher premiums for comparable plans than men, women who plan on becoming pregnant often must purchase a supplemental maternity benefits package (known as a “rider”) if they wish to receive prenatal checkups, assistance with delivery and other pregnancy-related care.
  • This is because most individual market policies do not include maternity coverage.
  • In comparison: Employer-sponsored health plans must cover pregnancy on the same basis as other conditions according to the federal Pregnancy Discrimination Act of 1978.

    • Maternity riders are extremely expensive, and can cost more than the monthly premium for the healthcare policy itself.
      • In Kansas and New Hampshire, for example, some riders cost over $1,100 per month.
      • Riders are not always available for purchase.
      • Even upon obtaining a rider, women often face mandatory waiting periods of up to 2 years before coverage kicks in and/or the benefits covered are slim.

    So why do women pay more than men?

    Most states require that the premiums charged for individual coverage be statistically justified according to formulas created by the insurance industry.

    This means that insurance companies can only charge women higher premiums if they can show that the true cost of providing coverage (and care) to women is higher than it is for men.

    Insurance companies claim that it is more expensive to cover women, at least until the age of 55, because they have higher health care expenses during their childbearing years.

    But most individual insurance policies don’t even cover pregnancy-related care, or they require women to purchase the costly maternity riders that we described above.

    Question: Why should women bear the burden of pregnancy-related costs when having babies is culturally preferred by society?

    Insurer statistics claim that younger women also tend to use more health services than their male peers, and that they are more likely to have chronic conditions.

    But usage patterns alone do not explain the huge differences in premiums that exist nationwide.

    For example, one Missouri company charges 40 year-old women 140% percent more than men; while another company only charges 15% more; what accounts for this enormous disparity?

    Do the premiums charged actually reflect any real difference in the cost of providing care?

    As this editorial points out, insurance companies no longer set premium rates based on a person’s race, which was once allowed and “justified” by insurance company tables. Why should it be any different when it comes to gender?

    Continue to Page 2 for the solution…

    { 0 comments… add one }

    Leave a Comment