Employer Provided Health Insurance Question

HappycurlsHappycurls Posts: 188Registered Users
Hello Everyone,

I rarely post here anymore but still check in from time to time. I have an insurance question and was hoping you all might have some resources to help me.

I recently started a new job and am filling out benefit info. I noticed that the monthly health insurance premiums vary according to age and gender. I have never experienced this before as I thought that was the whole point of group insurance - pooled risk so everyone pays the same premium.

Women of every age group pay more than men and the premiums rise for each age band. I asked HR about it and they said they use age/sex banding to determine premium costs. That just seems completely illegal to me but maybe I'm wrong? The premium chart has me paying 37% more than a man of my same age! This question is limited solely to employee coverage, not spouse or dependents.

Does anyone have any actual government based info (link please?) that says whether this is allowed or not? Thanks!

Comments

  • mrspoppersmrspoppers Posts: 7,223Registered Users Curl Novice
    It's legal because there is a calculable difference in health costs for different age groups and genders. However, there are limits to which employer pools can do this and how much more they can charge the different bands. These limits are regulated at the state level and vary greatly by state. You should contact your state insurance commissioner for information about what's legal in your state and for your specific employer.
    When are women going to face the fact that they don’t know their own bodies as well as men who have heard things?

    Don Langrick
    Bonsai Culturist
  • HappycurlsHappycurls Posts: 188Registered Users
    Thanks, MrsP. I can't remember what exactly you do but I know you know your stuff in this realm.

    I've read various articles online that say "most employers usually can't charge women more than men" but none of them clarify the "most" or "usually" statements. I guess there's nothing to be done but pay the higher amount...

    I've also read that Obamacare will change this (allowing insurance companies to charge women more, but age differences will still be allowed) in 2014 but I think that's for individual and small group plans. I don't know if large group plans will still allow this.

    I have contacted both my state insurance commissioner and the state where my employer is based. Both said it may or may not be allowed, it depends on the situation. Um, thanks for that clarification?
  • mrspoppersmrspoppers Posts: 7,223Registered Users Curl Novice
    Whether they can do it or not has to do with the size of the insurance pool. For example, a small company that has a small pool might be able to do it but a mega corporation or a company that's part of a large pool would not. What I read was that the federal law/policy is vague and uses words like large, small, limited, many, etc. That's why states have done their own defining and clarifying.

    My experience is in life insurance and annuities, not health insurance, so I'm not really an expert. However, I will say that insurance is so highly regulated that if your company offers health insurance from a reputable insurance company, the insurance company or insurance broker has done their homework. Your company probably meets the requirements for whatever reason.
    When are women going to face the fact that they don’t know their own bodies as well as men who have heard things?

    Don Langrick
    Bonsai Culturist
  • multicultcurlymulticultcurly Posts: 5,136Registered Users Curl Connoisseur
    In general, I think women pay more during their childbearing years, so 20s and 30s and older people pay more than young and middle age because as a group, they tend to have mire chronic health issues. Larger companies tend to have better insurance when compared to small companies IMO.

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  • curlyarcacurlyarca Posts: 8,449Registered Users Curl Connoisseur
    Happycurls wrote: »
    Thanks, MrsP. I can't remember what exactly you do but I know you know your stuff in this realm.

    I've read various articles online that say "most employers usually can't charge women more than men" but none of them clarify the "most" or "usually" statements. I guess there's nothing to be done but pay the higher amount...

    I've also read that Obamacare will change this (allowing insurance companies to charge women more, but age differences will still be allowed) in 2014 but I think that's for individual and small group plans. I don't know if large group plans will still allow this.

    I have contacted both my state insurance commissioner and the state where my employer is based. Both said it may or may not be allowed, it depends on the situation. Um, thanks for that clarification?

    That is correct according to Healthcare.gov (click on the timeline somewhere around January 2014):
    No Discrimination Due to Pre-Existing Conditions or Gender
    Effective January 1, 2014
    The law implements strong reforms that prohibit insurance companies from refusing to sell coverage or renew policies because of an individual’s pre-existing conditions. Also, in the individual and small group market, it eliminates the ability of insurance companies to charge higher rates due to gender or health status.

    Obamacare/PPACA is attempting to widen the insurance pool via the individual mandate (which was found constitutional per the Supreme Courts decison last August) and other regs in the law including those that force insurance companies to calculate risk according to the original way health insurance risk was calculated back when employer-provided healthcare was started: community ratings (risk for the aggregate) instead of risk ratings (risk for an individual). But you're right, it's modified community rating, not pure community rating.

    Read the Law | HealthCare.gov

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