Colorado Senator Morgan Carroll On Health Insurance

Colorado state senator Morgan Carroll has written a very persuasive article about why we should end gender-based pricing in the individual health insurance market.  I agree that it makes more sense to average premiums across the entire population, but I also understand that doing so would mean a rate increase for men to offset the rate decrease for women.  Senator Carroll pointed out in her article that 18% of Colorado women had no health insurance in 2007.  While this is true, it’s important to note that during the same time period, nearly 23% of Colorado men had no health insurance.  Averaging premiums for men and women and giving everyone the same average rate would mean that men would pay more than they currently do.  It stands to reason that this would result in more men dropping their coverage and joining the ranks of the uninsured.

In Carroll’s article, she described a meeting of the Health Care Task Force where the practice of gender-based pricing in health insurance was debated.  I am amazed by the comment from Rep. Jim Kerr, who explained that “women like to shop” and we should thus do a better job of shopping for our health insurance.  And by the health insurance underwriter (a male) who said we should “blame God” for the fact that women’s parts are on the inside and men’s parts are on the outside.  Seriously?  Those comments alone make me hope for gender equality in health insurance just so that we can stop having this discussion.

Senator Carroll also noted in her article that in the individual health insurance market “the rates are already significantly higher than in the small or large group market.”  This isn’t correct – in fact, the opposite is true.  In most states, including Colorado, group health insurance premiums are more expensive than individual premiums.  This is because individual plans can exclude pre-existing conditions or decline applicants with serious health issues.  In addition, group plans have more state mandated coverage (like maternity) than individual policies.  For my own family, a group health insurance plan would be twice as expensive as our individual plan (even for a policy with much higher out of pocket exposure).

It’s a common misperception that group policies are less expensive than individual policies, likely because employers pay a chunk of the group policy premium, masking the true cost of the employee’s health insurance.  The amount that is taken out of an employee’s check is not the actual cost of the health insurance.

About Louise Norris

Louise Norris has been writing about health insurance and healthcare reform since 2006. In addition to the Colorado Health Insurance Insider, she also writes for,, Verywell, Spark by ADP, and Boost by ADP, and Gusto. Follow on twitter and facebook.


  1. Louise:
    In addition to what you wrote, aren’t group policies more expensive, because they are community rated?
    If the young and old paid the same rates in the individual market, what would happen to the premiums?
    You also did not mention renewal premiums.
    My family is paying higher premiums for a long-held individual policy than we would pay in the group market.

    If Obama’s plan goes through, and individual policies are guaranteed issue AND community-rated, how would that effect premiums in Colorado?
    Don Levit

  2. As anyone who’s spent more than 5 minutes in the health insurance business knows, insurers are essentially amoral. What I mean by that is that they don’t introduce fairness or unfairness into policy rate structures or promote a social agenda. They just look at where the claims are coming from and adjust rates accordingly. The contention that insurers are acting “unfairly” in charging differing rates for men and women is an attempt to replace arthmetic with political theater.

    But… this is essentially a non-issue. Insurers will collect the same amount of premium no matter how they split it between the sexes. It’s time for insurers to bow to political correctness and charge unisex rates. Let’s begin the process by unisexing the rate sfor Colorado’s Public Plan Option, CoverColorado. I would suggest that Sen Carroll introduce legislation to do just that. And, while we’re at it let’s make CoverColorado offer plans on a purely community rated basis, one rate for all regardless of age. What do those stupid acturies and underwriters know anyway?

  3. Don,
    Good questions. I’m not familiar with large group, but small group premiums in Colorado are not community rated unless the employer specifically asks for it. Premiums are quoted based on the age of the employee, using 5 year age bands. Premiums for older employees cost more than premiums for younger employees – the same as how the individual market works.
    As far as renewal premiums, it depends on the company. Some carriers in the individual market in Colorado use the same rating factors for existing policies as they do for new policies. So a 45 year old female will pay the same premium regardless of whether she has had her policy for 10 years, or just got it last month. Other carriers do not, and people on those plans will find that after several years their policy will be quite a bit more expensive than it would be if they were getting a new policy with the same company. Of course this leads to shopping around – which is great as long as the person is still healthy and able to qualify for another policy.
    I believe that if policies in Colorado were to switch to community rating and guaranteed issue, there would be a significant increase in premiums for most people (perhaps not for older people, and for people who currently pay a high premium for a guaranteed issue policy because of pre-existing conditions). But if the provisions to require everyone to get health insurance pan out, I believe this might offset some of the rate increase.

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