Lawsuit assails ‘gender rating’


California insurers are discriminating against women, charging them more for individual health insurance than men, the city of San Francisco maintained in a lawsuit filed Tuesday against the state regulators who govern them.

The suit contends that Insurance Commissioner Steve Poizner and Cindy Ehnes, director of the Department of Managed Health Care, approved a system that allows the insurance companies to impose “gender rating” when pricing policies, resulting in women paying as much as 39% more for coverage then men.

At issue in the suit are rates for individuals and not group policies. These policies are often purchased by people who are unemployed or work for businesses that don’t offer health insurance or adequate coverage.


The lawsuit contends that the state’s existing health insurance laws are unfair to women and should be declared unconstitutional. Poizner’s office disagreed and said the rates were in line with state law.

“The Department of Insurance implements the laws as passed by the Legislature,” spokesman Darrel Ng said. “The Legislature explicitly lists gender as one of the factors to be considered. Until the Legislature changes the laws or the courts decide differently, we will uphold the law.”

Ten states outlaw the practice of “gender rating” health insurance rates for individual coverage -- but not California.

The lawsuit is part of a flurry of activity in Sacramento and around the state seeking to end gender rating in health insurance.

Since December, two bills have been introduced in the Legislature to address the issue: AB 119 and SB 54.

If either of the two bills were signed into law, the suit against the state could be dropped, San Francisco City Atty. Dennis Herrera said. “If the law is changed to stop gender rating, then there’s really not much need to go through with the suit,” he said.


California’s state insurance law says gender rating is legal when backed up by statistics.

“Unless otherwise prohibited by law, premium, price or charge differentials because of the sex of any individual when based on objective, valid and up-to-date statistical and actuarial data or sound underwriting practices are not prohibited,” the law says.

The Times reported in June that insurers Aetna Inc. and Anthem Blue Cross charged women in California more than men for individual coverage and that Blue Shield of California was about to follow suit.

Blue Shield spokesman Tom Epstein said at the time, “Our egghead actuaries crunched the numbers based on all the data we have about healthcare” and found that women were more accident-prone then men and more likely to break bones or get sick.

“It’s all about the statistics,” he said.

Blue Shield of California declined to comment on the lawsuit Tuesday.

Herrera said the need for changing the law was urgent.

“A lot of times, women are priced out of private health coverage because of the discriminatory practices by insurance companies,” he said. “This means women have to rely on public hospitals and clinics, and over the last few years we’ve seen an influx of women who can’t afford insurance come into San Francisco General Hospital.”

As the economic downtown worsens and the costs of healthcare rise, Herrera said, the numbers of those who can’t afford healthcare will grow.

“Our state is really behind the curve on this one,” he said. “When women can’t afford healthcare because they’re priced out of it, they’re not the only ones who pay for it. These women have to turn to the public health system, a system that is already strained as it is, and every taxpayer ends up paying for it.”