Firm’s Data Show The Farther You live From Downtown Chicago, The Less Expensive Your Monthly Coverage.
Why would people who live in inner-ring suburbs such as Berwyn,
Evanston, Oak Lawn and Oak Park be able to obtain health-care insurance
quotes that are 14.6 percent, on average, lower than their Chicago
neighbors?
Based on major health-insurance carriers’ rates and policies, people
living 15 miles to 25 miles from downtown Chicago pay 12 percent to 15
percent less on their monthly premiums, and those who live 25 miles to
40 miles outside of the city pay 20 percent to 30 percent less,
according to data compiled by Norvax Inc.
Chicago-based Norvax makes software that lets people search for the
lowest or best private coverage offered by insurance brokers and
agents. Norvax’s public exchange, which boasts more than 80 insurance
carriers, operates as GoHealthInsurance.com. Norvax’s consumer markets team culled the data by running GoHealthIn surance.com quotes using 3,029 ZIP codes and 963 plans in Illinois, and then narrowing the field to the Chicago area.
Perhaps the most surprising finding is that people who live in the
suburbs south and west of Chicago, areas generally considered
blue-collar, pay 24.5 percent less for health-insurance coverage than
do Chicagoans. People who live north of the city pay 14.6 percent less.
Brandon Cruz, a software developer who co-founded Norvax with
salesman Clint Jones, said he wasn’t shocked by the results because
"different areas have different costs, based on the hospitals, doctors
and [health-care] networks in those areas. The findings highlight the
cost of health care in these areas."
Judy Dugan, research director for Consumer Watchdog, a Santa
Monica-based public policy advocacy group, said that while she couldn’t
reach specific conclusions without the underlying data, the findings
point out that today’s individual-coverage insurance market "is the
Wild West" partly because each person is buying customized coverage
that is largely unregulated.
Dugan speculated that many insurance companies don’t want to do
business in an urban area because "they like a mommy and a daddy and
three healthy kids" as clients.
"It’s one reason we need health-care reform — to get rid of this kind of weird disparity in pricing," Dugan said.
Separate data from the latest U.S. Census Bureau from 2008 reveal
that 26.5 percent of Chicagoans ages 18 to 64, or 470,344 residents,
have no health-insurance coverage.
Among Chicagoans 65 and older, 3.8 percent, or 10,731 of the city’s elderly, have no health-insurance coverage.
In contrast, the census data show that in Evanston, 6.8 percent of
people ages 18 to 64, or 3,393 residents, have no health-insurance
coverage, while, statistically, virtually everyone 65 and older is
covered.
These differences are created by state regulations and also by the insurance companies themselves.
The insurance companies typically divide a state into as many as
eight geographical zones. While premiums are largely determined by the
overall health of people who live in each zone, the insurer’s ability
to negotiate discounted rates for services within its provider network
in each zone also is a key factor. The amount of health-care services
policyholders use in each zone, including prescription-drug use, also
plays a factor in the premium differences.
Experts say any major health-care reform that Congress passes will
change the balance of the insurance equation by banning insurers from
charging women more than men, barring caps on lifetime benefits,
limiting how much more insurers can charge older policyholders than
younger ones, and prohibiting insurers from denying coverage to people
with pre-existing conditions.
Inc., used his company’s software to compare health-insurance rates for
Chicagoans and those living outside the city.
(Jean Lachat/Sun-Times)
30-year-old man who stands 5-foot-11, weighs 155 pounds and is in good
health would get these monthly premiums based on the lowest-cost $1,000
or $1,500 deductible health-insurance plan with any co-pay:
Insurance company No. 1
Chicago, ZIP code 60607 …………………………………………… $143.41
Berwyn, ZIP code 60402 ……………………………………………. $126.92
Kankakee, ZIP code 60901 …………………………………………. $106.22
Insurance company No. 2
Chicago, ZIP code 60607 …………………………………………… $106.24
Berwyn, ZIP code 60402 ……………………………………………. $92.70
Kankakee, ZIP code 60901 …………………………………………. $80.20
Insurance company No. 3
Chicago, ZIP code 60607 …………………………………………… $175.87
Berwyn, ZIP code 60402 …………………………………………… $163.77
Kankakee, ZIP code 60901 ………………………………………… $157.08
Source: Norvax, Inc.
Contact the author at: [email protected].
