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No Where to Turn: Women and the Individual Insurance Market:

Lisa Codispoti, Senior Counsel National Women’s Law CenterFamilies USA • Health Action

January, 2009

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Overview

Women and the individual insurance market

• Brief background on women and health coverage

• Overview of challenges women face getting coverage in the individual market

• Practice of Gender rating• Availability of Maternity coverage• How health reform can help

Insurance Coverage Patterns: Adults 18-64, 2006

Source: 2007 CPS Data

Insurance Coverage Patterns:Uninsured by Age

Percent Uninsured by Age

26.1%

23.0%

16.5%

13.0%

32.4%30.7%

21.0%

16.5%

14.1%

12.5%10.0%12.0%14.0%16.0%18.0%20.0%22.0%24.0%26.0%28.0%30.0%32.0%34.0%

18 to 24 25 to 34 35 to 44 45 to 54 55 to 64

Per

cent

Uni

nsur

ed

Adult Women Adult MenSource: 2007 CPS Data

Insurance Coverage Patterns: Uninsured Women by State

Source: NWLC analysis of 2006 &2007 7 CPS Data

Insurance Coverage Patterns: Uninsured & Employment

Status

Source: NWLC Analysis of March 2005 Current Population Survey

Uninsured Men Uninsured Women

Full-Time69%

Full-Time43%

Not working

35%

Not working

18%

Part-Time22%

Part-Time13%

Women and the Affordability Gap

On average, women use more health services than men

• Reproductive health needs• Prescriptions drugs• More likely to have a chronic

condition (38% vs. 30%)• Certain mental health problems

affect twice as many women

Women and the Affordability Gap

Regardless of insurance status, women are more likely than men to:

• Spend greater than 10% of their income on out-of-pocket costs

• Avoid necessary health care due to cost

• Face medical bill problems

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Where Do Women Get Their Health Coverage?

Women's Health Coverage, Ages 18-64 2007

7%

18%

65%

15% Employer-Sponsored

Uninsured

Public

IndividualMarket

Source: U.S. Census Bureau, Current Population Survey’s 2008 Annual and Social Economic Supplement

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Why Understand the Individual Market?Only a modest number of women are currently

covered that way, BUT1. Many more try to find individual market coverage

without success – nearly 9 out of 10 people who seek policies do not ultimately buy a plan

2. Some employers are replacing employer-sponsored coverage with fixed sums to buy insurance through the individual market

3. Some proposals would expand the individual market4. There are critical differences between employer-

sponsored coverage and individual market coverage

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Nowhere to Turn: How the Individual Health Insurance Market

Fails Women

Some Definitions

“Medical Underwriting” = Insurance companies decide

1)Whether to offer coverage 2)What to cover and2) What premium to charge

“Gender Rating” = Insurers charge women and men different premiums for the same health insurance coverage

“Actuarially Justified” = Based on actual differences in providing health insurance to women versus men (insurance industry defense for gender rating)

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Challenges Women Face in the Individual Market

• Rejection based on health history– Insurers in 9 states and D.C. can reject applicants

who are survivors of domestic violence– Insurers can reject women for coverage based on

a previous Cesarean section

• Rating based on age• Rating based on gender

• Rating based on health status

• Pre-existing condition exclusions

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State Efforts to Protect Against Gender Rating

Bans gender rating: ME, MA, NJ, NY, OR, WA, MN, MT, NH, ND

Limits gender rating with rate band: NM, VT

State does not have protections against gender rating

Key Findings – Gender Rating• Gender rating is prevalent throughout the country

among similar plans:– At age 25, women are charged between 6% and 45%

more than men.– At age 40, women are charged between 4% and 48%

more than men.– At age 55, women are charged between 22% less and

37% more than men.

• Wide variations across and within states undercuts insurance industry defense of gender rating as actuarially justified – and raise questions of arbitrariness

• Maternity coverage does not explain the difference

n=3,512 policies (offered in 47 states and D.C.)

12%

9%

20%59%

ComprehensiveMaternity Coverage

Less-than-ComprehensiveMaternity Coverage

SupplementalMaternity RiderOffered

No Maternity CoverageAvailable

Key Findings – Maternity CoverageMost Individual Market Insurance Policies Do Not Cover

Maternity Care

*Comprehensive maternity coverage includes coverage for prenatal care, labor, delivery, and postnatal care, for both routine pregnancies and in case of complications.

*

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Maternity Riders: A Bad Deal for WomenExample: A woman pays $106 per month for a maternity rider, in addition to her

regular health insurance premium. Her rider requires 20 % coinsurance and covers just $2,000 of maternity charges for the first 2 years she is enrolled.

Uncomplicated Vaginal Delivery (2006 Average =

$7,488)

Cesarean Section with Complications (2006 Average =

$16,996)

Rider Covers $2,000 $2,000

20 % Coinsurance

$1,498 $3,399

Over Benefit Limit

$3,990 $11,597

Annual Rider Premium

$1,272 $1,272

Woman Pays At least $6,760 At least $16,268

State Efforts to Ensure Access to Maternity Care

• 5 states have passed laws requiring all health insurers in the individual market to include maternity coverage– MA, MT, NJ, OR, WA

• Other states have adopted laws that are more limited in scope:– Only certain insurers are subject to the law– Insurers are merely required to offer the

coverage

• Some states have enacted public programs to fill in the gaps

Some recent developmentsGender Rating: • Several states with possible legislative

proposals to ban gender rating• MT legislation filed to repeal gender rating

ban• Litigation: CA (filed by city of San Francisco)

Maternity Coverage: • CA: Maternity coverage mandate legislation

vetoed by Governor

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For More on Women and Health Reform…

Visit our website www.nwlc.org/reformmatters to:

– Download a copy of our report No Where to Turn– Download or request a copy of our Reform Matters

toolkit for advocates– Participate in our monthly conference calls– Request technical assistance on health reform

Contact us at reformmatters@nwlc.org• Lisa Codispoti lcodispoti@nwlc.org 202/588-5180