1Center or American Progress | Facts About the Health Insurance Compensation Gap
Facts About the HealthInsurance Compensation Gap
Jessica Arons and Lindsay Rosenthal June 2012
Unortunately the gender pay gap is alive and well: Women in the United States earned77 cents or every $1 earned by men in 2011—an average o $10,622 in lost wagesevery year.
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Yet that earnings ratio actually understates the extent o women’s disparatetreatment in the workorce because they also experience a health insurance compensa-tion gap. Below are the answers to some key questions about this gap, as well as how the Aordable Care Act—the new health reorm law—works to close it.
Q: What is the health insurance compensation gap?
A: Women are less likely than men to receive health care coverage through theiremployer and are more likely to have higher out-o-pocket medical costs. Tis results ina health insurance compensation gap on top o the wage gap.
Q: What is the difference between men’s and women’s access to job-based coverage?
A: Women are signicantly less likely than men to have access to their own employer- based coverage. Less than hal o women (48 percent) are eligible to get health insurancethrough their jobs, compared with 57 percent o men, in part because women are morelikely to work or small businesses and in low-wage jobs. Although two-thirds o women between the ages o 18 and 64 have employer-based insurance coverage, only 38 percento women are enrolled in an insurance plan they receive through their own employer,
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while 24 percent receive employer-based coverage as a dependent on their spouse’s orpartner’s plan.
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In contrast, 50 percent o men receive insurance coverage through theirown employer, and only 13 percent o men receive dependent coverage.
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Q: What is the financial impact of the compensation gap?
A: Te gap in health insurance compensation translates into women losing an average o $4,508 or single coverage and $10,944 or amily coverage in employer contributions tohealth benets each year.
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Given that two-thirds o mothers are either primary bread- winners or co-breadwinners or their amilies, the compensation gap is a signicant burden on the budgets o many American amilies.
2Center or American Progress | Facts About the Health Insurance Compensation Gap
Q: Where do women turn when they don’t have access to job-based coverage?
A: When working women cannot obtain employer-based coverage and earn too muchto qualiy or Medicaid, they must turn to the individual health insurance market. Yet women ofen ace discrimination in the individual market—they are charged more orcoverage,
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denied coverage or gender-specic conditions,
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and sold plans that inad-equately cover their health needs.
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Q: How much more do women spend out of pocket on health care?
A: Even with employer-based coverage, women have higher out-o-pocket medicalcosts than men. Overall, women o reproductive age spend 68 percent more out o pocket than men on health care,
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in part because their reproductive health care needsrequire more requent health care visits and are not always adequately covered by theirinsurance. Among women insured by employer-based plans, oral contraceptives aloneaccount or one-third o their total out-o-pocket health care spending.
Q: How are women affected by the compensation gap?
A: Te combination o being paid less than their male counterparts and having higherout-o-pocket medical expenses leaves many women struggling to pay their medical billsor trading o other necessities such as ood, heat, and electricity to cover their medicalcosts. Fify-two percent o women report delaying or going without needed care becauseo cost (not lling prescriptions or skipping tests, treatments, or ollow-up visits), com-pared with 39 percent o men.
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Women also report higher rates o medical debt thantheir male counterparts.
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And one study showed that more than hal o low-income women are underinsured, meaning they spend 10 percent or more o their income onout-o-pocket health care costs and premiums.
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Q: How will the Affordable Care Act help reduce the health insurance compensation gap?
A: Te Aordable Care Act institutes a series o reorms designed to drastically expandcoverage and contain health insurance costs or all Americans. Many o the reormsenacted by the new health law have been and will continue to be especially benecial or women, as they help resolve many o the problems outlined above. Te health care bill:
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Provides insurance premium assistance through income-based tax credits on a slidingscale beginning in 2014
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Expands Medicaid eligibility to people with incomes below 138 percent o the ederalpoverty level—about $31,809 or a amily o our in 2011
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Allows young people to remain on their parents’ health plans until the age o 26
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Ends discrimination that has lef women paying up to 150 percent more or the samecoverage purely because o their gender
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Bans insurance companies rom denying coverage to women through pre-existingcondition exclusions
3Center or American Progress | Facts About the Health Insurance Compensation Gap
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Ensures that women receive vital preventive care at no additional cost—signicantly including contraceptive coverage, which will eliminate one o the primary sources o women’s out-o-pocket health care spending
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Mandates that maternity benets be covered as an essential part o women’s health care
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Caps co-pays and deductibles, which will help reduce the amount women pay in out-o-pocket expensesTrough these reorms that level the playing eld or women in the health care market,the Aordable Care Act will help reduce the compensation gap that exacerbates thedisparity between men and women’s earnings. For more inormation on the compensa-tion gap, see“Te Health Insurance Compensation Gap: How Unequal Health CareCoverage or Women Increases the Gender Wage Gap.”
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Facts About the Health Insurance Compensation Gap
Jessica Arons and Lindsay Rosenthal give the basics on why women have a harder time getting affordable health care than men.
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