Tuesday, October 27, 2009

Why Women Need The Public Option In Health Care

Here are the reasons:

1. Individual health insurance policies are allowed to discriminate against women in many states in the sense that women pay more for identical policies (this is called gender rating). Two extreme examples: a 25-year old woman can be charged as much as 84% more than a 25-year old man for a policy which does NOT cover maternity care, and a 40-year old woman who does not smoke can be charged more for an identical policy than a 40-year old man who smokes. And maternity care is rarely covered.

These are the markets in which we are supposed to seek coverage today if we are not qualified to be covered under an employer group plan.

2. What about those group plans? They can charge different average premia based on the number of women firms hire, provided that the states have not made that practice illegal. Thus, firms in traditionally female dominated fields may be made to pay more for the very same package of health insurance than firms in a traditionally male dominated field.

What is going on here? The dry statistical explanation for gender rating is that women consume more health care than men, as a group, until a fairly advanced age, and because it is not possible to tell which women the high consumers are, all women are charged more. (After a certain age men's consumption increases and even exceeds women's average use levels. But soon after that point Medicare takes over and Medicare does not practice gender rating! Interesting, eh?)

Looked at in another way, every individual woman is sorta "punished" for women's higher medical care use, because the statistics assume that she is going to have the average use pattern of other women like her.
Link via Southern Beale