This afternoon, the Wall Street Journal reported that the health insurance industry said it shouldn’t charge women higher rates for health insurance coverage than it charges men. I discussed the issue of gender rating in a previous post. According to the Wall Street Journal:
"Sen. John Kerry on Tuesday introduced legislation that would prevent insurers from charging women more than men when women buy coverage on the individual insurance market. The Massachusetts Democrat cited research showing that women often face higher premiums than men when they buy identical coverage."
"During a Senate Finance Committee hearing on health-care reform, Karen Ignagni, president of America’s Health Insurance Plans, told lawmakers she doesn’t think gender should factor into women’s rates when they’re buying individual policies. Already the group has said it’s willing to stop charging Americans with health problems more money if everyone is required to have health-insurance coverage."According to the Kansas City Star, Karen Ignagni said "We don't believe gender should be a subject of rating." Hmmm . . . That isn't what an AHIP-sponsored Milliman report said in 2007. According to an AHIP press release touting the report:
Guarantee issue requires insurers to sell an individual health insurance policy without regard to a person’s health and community rating requires that all consumers pay the same or similar premiums without regard to age or gender. According to the report, these initiatives have the potential to cause individuals to wait until they have health problems to buy insurance. This could cause premiums to increase for all policyholders, increasing the likelihood that lower-risk individuals leave the market, which could lead to further rate increases. If this continues, the pool or market could essentially collapse or shrink to include only the high risk population. (emphasis added)In other words, in 2007 AHIP said that gender rating was good because it helped stave off the collapse of the individual market. In reality it helped boost profits by allowing insurers to better control the risk they were willing to accept. In 2009, however, Ignagni and AHIP say that they think gender rating is bad. Why? Because Ignagni and AHIP fear that market-reform pressures could alter the way health insurers conduct their business--and ultimately cut into insurer profits. Thus, Ignagni and AHIP alter their position on gender rating in order to appear to be more consumer-friendly and thereby reduce pressure for more sweeping market reforms.
