As the debate about whether and how to change the U.S. health care system rages on, I seem to see more and more advertising of individual health insurance plans.
To need individual health insurance has always seemed a scary place to be.
The reasons? First, individual health insurance generally provides a very narrow range of coverages. Second, people pay significantly more for individual coverage than an employer pays to cover an individual in a group. And perhaps most important, exclusions for pre-existing conditions can defeat the purpose of buying health insurance at all.
Many young, healthy people who could afford to buy health insurance choose not to do so. Nevertheless, if they suffer hospitalization as the result of a serious traffic accident or a sudden illness requiring hospitalization, the extremely high cost of a hospital stay is unlikely to make them rethink that decision.
For those who realize the risk of not being covered, paying premiums – even high individual insurance policy rates – might still be a savings over large medical bills or ongoing treatments for lengthy illnesses.
In a segment on Mississippi Public Radio last week, Mississippi Insurance Commissioner Mike Chaney reminded listeners that insurance is a business, with a keen eye on its bottom line and a need to make profits for its shareholders.
More significantly, it is a financial business.
Insurers use underwriting – a term that applies to financial products – and actuarial data to determine what financial risk they might incur with their policyholders.
As Chaney said, that doesn’t make them bad.
It makes it necessary, however, for consumers to examine carefully what they’re buying in the health insurance product and whether they’re getting value for the money.
According to a 2008 study by the National Women’s Law Center, women are most likely to be on the losing end when buying individual health insurance.
While there are a number of state and federal laws that govern employer-based health insurance, protecting women from gender discrimination, insurance regulation at the state level that would govern individual health insurance policies is hardly regulated at all.
Women are the primary consumers of health care services, said the Kaiser Family Foundation. Not only do women use more services for reproductive issues, breast health and maternity care, women most often are in charge of managing health care for their children and sometimes their spouses and parents.
The need for more health care services works against women seeking individual policies. By law, in most states insurance companies can charge a woman a much higher premium rate than a man of the same age. And not just a little bit more. The same National Women’s Law Center study noted that “one insurer in Missouri charges 40-year-old women a whopping 140 percent more than men.”
Not everyone can buy individual health insurance, because in most states companies have the option of denying coverage for any number of reasons, such as any history of medical problems. In Mississippi, women can be denied coverage if they have been victims of domestic violence.
The kicker for women of childbearing years is that individual policies generally do not include maternity coverage. The National Women’s Law Center examined 3,500 individual health insurance policies across the country and found 12 percent that offer comprehensive coverage of maternity, 9 percent that offer limited coverage of maternity and the rest exclude maternity coverage completely.
With some of the proposed health insurance reform plans small businesses have said they will simply give a set amount of money to the individual to go out and purchase their own health insurance.
Individual health insurance as it exists now is flawed, leaving women with much greater financial exposure, even if they are able to purchase coverage.
Whatever the outcome of the national debate, in Mississippi we need to press our Legislature for more equitable access and pricing in the individual health insurance marketplace.
Lena Mitchell is the Daily Journal Corinth Bureau reporter. Contact her at 287-9822 or firstname.lastname@example.org.
Lena Mitchel/NEMS Daily Journal