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Making You Pay For Your Ovaries

As if women didn't face enough obstacles already, today the New York Times reminds us that health insurance companies discriminate against them all the time. And it's all perfectly legal.

Using data from online brokers and insurance companies, Robert Pear looked at what men and women have to pay for insurance when they try to buy coverage on the individual market. As you may know, when you buy insurance on your own, rather than through an employer or other large group, insurers will adjust the premiums--and, in some cases, the benefits--based on the medical expenses they anticipate you incurring.

To some extent, they base this judgment on your history. That's why they ask what kind of diseases, injuries, and medical treatments you've had in the past. But they also base this judgment on your profile--your age, your occupation, your weight, and, yes, your gender.

Why gender? As the article notes, women tend to consume more health care in their working years. Partly that's because of pregnancy. But other factors seem to be at work, too. Among other things, women are more likely to get checkups and seek medical attention when they are sick.

All of that leads insurers to charge women more. According to Pear:

The disparities are evident in premiums charged by major insurers like Humana, UnitedHealth, Aetna and Anthem, a unit of WellPoint; in prices quoted by eHealth, a leading online source of health insurance; and in rate tables published by state high-risk pools, which offer coverage to people who cannot obtain private insurance.

Humana, for example, says its Portrait plan offers “ideal coverage for people who want benefits like those provided by big employers.” For a Portrait plan with a $2,500 deductible, a 30-year-old woman pays 31 percent more than a man of the same age in Denver or Chicago and 32 percent more in Tallahassee, Fla.

In Columbus, Ohio, a 30-year-old woman pays 49 percent more than a man of the same age for Anthem’s Blue Access Economy plan. The woman’s monthly premium is $92.87, while a man pays $62.30. At age 40, the gap is somewhat smaller, with Anthem charging women 38 percent more than men for that policy.

This finding has significant implications for the presidential campaign. McCain's health care proposal would, over time, move people out of employer coverage and into the individiual market, where this disparity would affect them.

But I think the more important (albeit related) lesson here is about the basic dysfunction of American health care. Conservatives (not just McCain) tend to argue that you should pay more for your medical care if you use it. That way, you'll think twice before seeking unnecessary care or engaging in behaviors that increase your health risk.

The pricing gap between men and women shows just how wrong this argument is. You don't choose to be born XX or XY. It's the product of chance--much like, say, being born with a cancer gene or some congenital disorder. And far from penalizing people for getting routine, preventative services, we should be encouraging them to do so, because it makes them more productive members of society. 

You can't really blame the insurers for charging women higher prices. It's a competitive business, after all. If one carrier offers identically priced coverage to men and women, a competitor--or, more likely, competitors--could steal customers by wooing away men with lower prices.

But that's why we need to change the system itself, so that no insurer can discriminate based on health risk and everybody has to pay the same rate. In other words, we need universal health care. 

Update: I forgot a useful piece of background information. Overall, women have a harder time both finding insurance and paying their medical bills, partly because their incomes tend to be lower. This year-old Commonwealth Fund report has the details. 

--Jonathan Cohn