Health insurance companies offer to cut rates for women

WASHINGTON -- Health insurance companies, facing the threat of a government health plan, offered Tuesday to reduce rates for millions of women and accept close federal regulation of their industry.

The higher premiums now affect 5.7 million women, many of them self-employed people who must buy their own coverage.

The industry is trying to head off creation of a government health plan that would compete with them to enroll middle-class workers and their families. President Obama and many Democrats favor such a plan, but the companies say it would drive them out of business. Employer groups are also leery, fearing a public plan would entice young, healthy workers by offering lower premiums.

"We are not asking people to trust us, we are asking people to trust government," Karen Ignagni, president of America's Health Insurance Plans, told a Senate panel that is crafting sweeping legislation to overhaul the nation's $2.5 trillion health-care system.

Although the bill won't be written for weeks, insurers and other interest groups are trying to shape it now.

Instead of a government plan as a check on their industry, insurers are offering to accept a series of consumer protections they contend would add up to a fairer marketplace and cut into the ranks of the 50 million uninsured.

Most Americans -- men and women -- are covered through employer plans, which are prohibited from charging higher premiums because of gender, poor health or other similar factors. Only about 9 percent purchase their own health insurance.

It's that group of women who face higher rates. That's because health-care costs for women tend to go up during childbearing years. Some policies don't cover maternity care.

Sen. John Kerry, D-Mass., suggested such practices amount to discrimination.

"The disparity between women and men in the individual marketplace is just plain wrong and it has to change," Kerry said.

Ignagni conceded. "We don't believe gender should be a subject of rating," she said.

She was part of a large panel including representatives from business, labor unions, insurers, consumer groups and public policy centers.

Finance Committee leaders want to bring a bill to the Senate floor this summer. The broad outlines will follow Obama's campaign proposal, which builds on the current system of shared responsibility among employers, government and individuals.

Lowering premiums for women will not necessarily mean that men will have to pay more. Many factors go into setting insurance rates. Age, for example, carries much greater weight than gender.

Insurers have already offered to stop denying coverage to sick people, and to end the practice of charging higher premiums to those with a history of health problems. In exchange, the industry wants Congress to require all Americans to carry health insurance, either through an employer plan, on their own, or a current government program like Medicaid.

What insurers want to avoid is a new government plan that would be open to middle-class workers and their families. Obama says such a plan would help keep private industry honest.

"I do not accept the premise that to keep the (private) plans honest you need a public program," said Ignagni.

The industry's concessions have yet to convince many Democrats.

"The bottom line is you need somebody who is not a private insurance company to be in the mix and there are many of us who feel very strongly about that," Sen. Charles Schumer, D-N.Y. "It would be giving all of you in the insurance industry an unfair advantage not to have a public plan."

Schumer said he believes Congress can write rules for a new public plan that would not give it an unfair advantage over private health plans. For example, the public plan would not get taxpayer subsidies beyond paying for startup costs, it would have to follow the same coverage rules, and doctors and hospitals would be free to opt out.

For some Democrats, particularly liberals in the House, support for a public plan is already a compromise because their real preference is for a "single-payer" plan -- a government-run program for everyone, like Canada and many European countries have.

Underscoring the strong feelings about that, Tuesday's meeting began with Capitol Police ejecting protesters who interrupted senators by shouting in favor of a single-payer plan. Finance Committee Chairman Max Baucus, D-Mont., has said that's not on the table.

"We want a seat at the table," shouted one protester.

"We want police," Baucus responded.

Capitol Police removed eight people.

Baucus and many others, including President Barack Obama, say single-payer is not practical or politically feasible.

"Everything is on the table with the single exception of single-payer," Baucus said recently. "This country is not going to adopt single-payer, at least not at this time."

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Associated Press writer Erica Werner contributed to this report.