Monday, December 28, 2009

Discrimination and Health Insurance

The healthcare bill the senate passed prohibits discrimination based on preexisting conditions or gender. It seems unconscionable that a woman might have higher premiums than a man or that someone who has diabetes could be denied insurance.

Yet, this is a principle we follow all the time in other circumstances. The example I’ll use is car insurance. Young male drivers face the highest premiums because they have accidents at higher rates than other groups. The fact that young males as a group are worse drivers lets insurance companies treat individual males who are safe drivers differently than it would another driver. But there are no protests in Washington. No one describes the different treatment as sexist, or discrimination against the young.

If it’s reasonable to charge someone different rates for car insurance, why isn’t it reasonable to charge someone different rates for health insurance? A woman can’t control the fact that she’s a woman, but then again, a young male can’t control the fact that he’s a young man. The only explanation I can think of is that health insurance is a more serious issue, which is true. But that doesn’t justify the principle behind discriminating against different groups. It appeals more to our emotions.

And car insurance is not a laughing matter by any means. If you don’t have insurance, you can’t drive since most laws will fine you or impound your car if the police find you driving without it. In many parts of the country moreover, a car is the only feasible means of transportation. Is it any fairer to make a young male risk breaking the law, or spending all of his disposable income so he can drive to work than it is to make a woman risk getting breast cancer because she can’t afford the higher insurance premiums that let her get her mammogram?

Insurance companies charge the higher premiums in both cases so they can turn a profit in spite of insuring risky segments of the population. So what do you think? Is it ok for an insurance company to charge a man higher insurance premiums than a woman, but not for a car insurance company to charge a woman a higher premium than a man? Why or why not?

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