Gender Based Insurance Premiums

Do you know that your health insurance premium is determined by looking at a number of risk factors? It is a complex formula that can include things like health history, age, geographical location, and gender. Insurers claim that this is necessary to be fair in their pricing policies. But others feel that basing premiums on gender is unfair. The extra money that an employer gets charged because they have a higher number of women employees gets passed along to those employees either through higher premiums or deductibles. Some feel that charging women more than men is discriminatory and should be illegal and this battle is now being played out on Capitol Hill.

The insurance industry says that if coverage is required for all Americans, then they would stop basing their rates using gender and health status to individuals and small groups. House legislation and the Senate health committee bill would treat the large group market much the same as the individual and small group markets. They would prevent insurers from setting rates based on the gender and health status. Plus, they would limit how much more insurers could raise premiums based on age.

"Discriminatory insurance practices, such as gender rating, should be abolished across all markets — individual and group," says Sen. Barbara Mikulski, D-Md., a senior member of the health committee. "A woman should not face discrimination based on something arbitrary like the size of the employer she works for."

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"Hot Goods" Provision

In June, a cherry processing plant in Williamsburg, MI closed its doors. Cherry Blossom LLC did not pay their employees for all of their hours before the plant closure. The cherries that were produced during that time period were sold to a company in Indianapolis for delivery to customers throughout the country.

The U.S. Department of Labor (DOL) oversees the Fair Labor Standards Act (FLSA) which sets wage and hour laws. They were notified when the employees didn’t receive their final paychecks from Cherry Blossom LLC. If employees are not paid in compliance with the FLSA, employers cannot deliver, sell, or ship in interstate commerce the goods that were produced by those employees. This provision in the FLSA is called the “hot goods” provision.

“We informed the buyer that it is illegal to sell goods worked on by employees who were not paid in compliance with federal wage laws,” said James Smith, district director of DOL’s Wage and Hour Division in Detroit, Mich. “Due to the investigation, the buyer agreed to pay $38,700 in back wages owed to workers at the plant.”

If you know of anyone that worked for Cherry Blossom LLC at the time they closed their doors, the DOL has their pay. Contact the Wage and Hour Division at 313-226-7448.

Employers should make it their business to understand FLSA rules and regulations.