Health Insurers Agree to End Charging Higher Premiums for Women.

Yesterday, on this blog, I referred to the national healthcare reform debate as being like a chess game with each side making moves in turn that will eventually lead to the final outcome.

In yesterday’s blog post, I wrote about how, on Monday of this week, a conciliatory position was struck by Senator Charles E. Schumer (D-NY) who said that any new government-run insurance program should be made to comply with all the rules and standards that apply to private insurance.

Schumer went on to list out a series of principles that should apply to any public plan. This included:

  • The public plan must be self-sustaining. It should pay claims with money raised from premiums and co-payments. It should not receive tax revenue or appropriations from the government.
  • The public plan should pay doctors and hospitals more than what Medicare pays. Medicare rates, set by law and regulation, are often lower than what private insurers pay.
  • The government should not compel doctors and hospitals to participate in a public plan just because they participate in Medicare.
  • To prevent the government from serving as both “player and umpire,” the officials who manage a public plan should be different from those who regulate the insurance market.

Still, the insurance industry through Karen M. Ignagni, president of America’s Health Insurance Plans, a trade group, responded to the Schumer plan by saying, “We are very, very grateful that members of Congress have been thoughtfully looking at our concerns.” But she said she still saw no need for a public plan “if you have much more aggressive regulation of insurance,” which the industry has agreed to support.

That was Monday. On Tuesday, Ignagni made her move on the chess board by offering to end the practice of charging higher premiums to women than to men for the same coverage. She made the offer in testifying before the Senate Finance Committee and with a nudge from Senator John Kerry, (D-MA), who, according to the New York Times, told Ignagni, “The disparity between women and men in the individual insurance market is just plain wrong, and it has to change.”

The Times pointed out that women are often charged 25 percent to 50 percent more than men for insurance providing identical coverage. In interviews last fall, insurance executives said they had a sound reason for the different premiums: Women ages 19 to 55 tend to cost more than men of the same age because they typically use more health care, especially in the childbearing years. Moreover, insurers said women were more likely to visit doctors, to get regular checkups, to take prescription medications and to have certain chronic illnesses.

The importance of the leveling the cost of insurance between men and women really has to do with plans for Congress to provide tax credits or subsidies to millions of people with low or moderate incomes to help them buy insurance. If the insurance being purchased is priced higher for a woman than it is for a man then the woman will end up receiving less assistance from the government than would a man.

The move on the part of Ignagni to agree to parity in pricing will help tidy up this issue and will better position the industry to continue argue against the need for a government-run health plan designed to compete with private plans to provide coverage for low income persons.

With these day-to-day serves and volleys, I may soon need to change my analogy from that of a chess match to that of a fast-paced tennis match.

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