Latest / Women at Work: Career, Leadership & Modern Work / Why Women Pay More for Bad Health Insurance Plans
Transcript
- Lucas: Luna, I want to talk today about something that costs women thousands of dollars a year, and most of us never even realize it's happening. Luna: Okay, you have my attention. What is it? Lucas: It's the health insurance plan you pick at work. A 2024 study from the Kaiser Family Foundation found that women spend about 18 percent more on out-of-pocket health costs than men, even when you take maternity care out of the equation. Luna: Eighteen percent — that's huge. But why would a plan penalize women if it's gender-neutral on paper? Lucas: Because 'gender-neutral' doesn't mean 'gender-equal' when women use more healthcare. Women need more preventive screenings — Pap smears, mammograms, bone density scans. They're more likely to have chronic conditions like thyroid disorders and autoimmune diseases that require ongoing medication. And they're the ones managing kids' appointments, elderly parents' appointments. Luna: So the plan design itself — deductibles, copays, drug tiers — it all hits women harder because of the actual pattern of care. Lucas: Exactly. Let me give you a specific example. A friend of mine — let's call her Sarah — she's 38, works as a marketing manager for a mid-sized tech company. Last year, her employer offered two plans: a low-premium, high-deductible plan at $75 a month with a $3,000 deductible, and a higher-premium plan at $225 a month with a $500 deductible. She went with the cheaper one because the monthly savings looked good on her budget. Luna: And I'm guessing that didn't work out well for her. Lucas: Sarah has hypothyroidism. She takes a daily generic pill, which under the high-deductible plan costs her $25 a month until she hits the deductible. Plus she needs an annual physical, a thyroid panel, a mammogram — those are covered as preventive, so no charge. But then she needed an ultrasound for a thyroid nodule. That was a specialist visit plus imaging — about $600 out of pocket. Then her daughter needed stitches from a fall — another $800. By year end, Sarah spent $3,200 beyond her premiums. Luna: So her total cost was over $4,000 — and she thought she was being smart by saving $150 a month on premiums. Lucas: Right. And this isn't an isolated story. KFF data from 2023 showed that women with employer coverage spent, on average, $1,082 annually on out-of-pocket costs, compared to $916 for men. That's a $166 difference. But for women with chronic conditions, the gap can be $500 or more. Luna: I wonder how much of that is driven by the shift to high-deductible plans. I remember reading that nearly half of covered workers now have a deductible of at least $1,000. Lucas: You're right — 48 percent, according to KFF. And that design disproportionately hurts women because they're more likely to hit that deductible with a few routine visits and prescriptions. Men, on average, use less care, so they're more likely to stay below the deductible and keep their premiums low. Luna: So it's basically a transfer from healthy employees to those who need more care — and women are overrepresented in that group. Lucas: Exactly. And there's another layer: drug pricing. Women are prescribed more medications than men, and they're more likely to be prescribed brand-name drugs for conditions like depression and anxiety. The drug tiers on many plans put those at higher copay levels. Luna: A 2022 study in JAMA found that women paid 30 percent more for brand-name drugs than men. That's not a small gap. Lucas: It's structural. And it's not just about the plans themselves — it's about how we're taught to evaluate them. Financial wellness advice often says 'pick the lowest premium' without a discussion of your actual expected healthcare needs. Luna: So what should women actually do during open enrollment? Run the numbers on total expected cost, not just the monthly premium? Lucas: Yes. And specifically, look at three things: the deductible, the out-of-pocket maximum, and the drug formulary. If you take any regular medication, see what tier it's on. If you have a chronic condition, calculate what a full year of care would cost under each plan. Often the higher-premium plan actually saves you money. Luna: And what about health savings accounts? Those are tied to high-deductible plans. Do they help? Lucas: They can, but only if you can afford to fund them. HSAs let you put pre-tax money away for medical expenses, and the money rolls over year to year. But the catch is you need the cash flow to contribute. For someone like Sarah, who's also saving for her kid's college and her own retirement, adding another $2,000 to an HSA might not be realistic. Luna: And there's also a broader policy issue here. Some states have started requiring insurers to cover certain women's health services with no copay, like contraception and mammograms. But that's state-by-state. Lucas: Right. The Affordable Care Act required preventive services to be covered with no cost-sharing, but that list hasn't been updated in years. There's a bill, the Women's Health Protection Act, that would expand that list to include things like postpartum depression screening and osteoporosis testing. It hasn't passed yet. Luna: And in the meantime, employers could do more — like waiving copays for certain screenings or offering a plan option with a lower deductible for employees with chronic conditions. Lucas: Some companies are starting to do that. Microsoft, for example, offers a plan with a $0 deductible for preventive care and a $500 deductible for everything else. But most employers still offer a one-size-fits-all menu. Luna: So what's the one takeaway you want listeners to remember? Lucas: Don't pick your health plan based on premium alone. Use the estimator tool your HR department provides, or build a simple spreadsheet. Estimate how many doctor visits you'll have, what prescriptions you'll need, whether you're planning any procedures. The difference between plans can be $1,000 or more a year — and that's real money. Luna: If today's episode helped you think about that decision differently, you know, we do this every week because we believe these conversations matter. This show stays ad-free because listeners like you choose to support it at buy me a coffee dot com slash fexingo. Just a small way to keep the insights coming. Lucas: Yeah, and we really mean that. Every contribution helps us keep digging into these overlooked costs. So if you got something out of this, consider it. Luna: Alright, back to the numbers. Lucas, you mentioned that women are more likely to have chronic conditions, but I want to be careful there — is that biological, or is it about diagnosis rates? Lucas: It's both. Women do have higher rates of autoimmune diseases, thyroid disorders, and migraines. But they're also more likely to seek care and get diagnosed. So part of the spending gap is about utilization, not just biology. Luna: Which actually makes the point even stronger: if women are being proactive about their health, the system should reward that, not penalize it. Lucas: Exactly. A system designed around the average male utilization pattern is going to miss the mark for half the population. And that's a problem employers and policymakers need to address — not just individual women shopping for plans. Luna: So next open enrollment, I'm running the numbers — not just the premium. Lucas: That's the move. And tell a friend too. A lot of women are leaving money on the table without realizing it.