Thursday, April 13, 2017

Health Insurers are getting rich

Retiring after 45 years of insuring human lives, I am still amazed to see how the insurance industry has bought and paid for most of our Congress; Democrat and Republican.  AARP generates over half of its’ revenue from insurance sales and isn’t likely to harm the industry or represent us.  Now our State government wants to hand over a half a billion dollars in additional subsidies!  The insurance industry has always relied on being both boring and “complicated” in order to carry out their scams and it is time to call them on this nonsense.  Many conservatives are still saying we don’t have a mandate for universal coverage in this country,  even though, decades ago, all 50 states have passed laws making the most expensive universal coverage, emergency room care, mandatory.  Private insurance is the managing of risks through underwriting, spreading of risk, and claims management.  Traditionally, health insurers divided their business into individual (fully underwritten) and group. With the introduction of Obamacare the ability to underwrite the individual market went away, which should have eliminated this differentiation of group and individual and thus spreading the risk better.  Because the states regulate insurance, and the insurance lobby is very effective, no one seems to care to force the insurers to price their business on all the risk that they assume, group and individual. 

While the insurers are complaining about their individual block of business the politicians are freely giving them our money.  The top seven health insurers net income for 2016 was over: 17 billion dollars.

1. Unitedhealth Group
2. Wellpoint Inc. Group (Anthem)                            
3. Kaiser Foundation Group
4. Humana Group 
5. Aetna Group
6. HCSC Group
7. Cigna Health Group 

While the insurance lobby was very effective in both writing and fighting Obamacare, they have lead misinformation campaigns such as: The government bureaucrat deciding your health care is worse than the insurance company bureaucrat deciding your healthcare.  Think for a minute, who gets the bonus for denying your claim.  Another is that you should be able to buy coverage that doesn’t cover everything.  Young people aren’t likely to have a problem so why should they pay for coverage?  One because they aren’t likely to have claims, the coverage is likely to be very inexpensive and two, when the claim does come in: it’s us taxpayers who are going to pay it.  The thought that “private industry” is more efficient than government doesn’t stand up to scrutiny: Medicare operates on about 4% of premiums, while private insurers are operating on between 15% and 20% of premiums (it would have been more except for Senator Franken).  The very idea of “For Profit Healthcare” is an oxymoron.  You can only increase profits by: more sick people, more expensive drugs and treatments, less cures, and more treatments.

If the pursuit of money isn’t taken into account healthcare is relatively simple.  You want to be able to see the doctor of your choice and your doctor wants to be able to charge what he/she wants.  This can be easily be done with a single payer system like Medicare, where a schedule of payments for procedures is set and the more the doctor charges over the schedule, the less the single payer will pay, leaving the difference up to the patient or private insurance.  Employer deductions for health insurance, from form 5500, can be the base for the tax that would pay for the single payer since employers would no longer have that obligation.

Unfortunately, I see little hope of change happening until we can limit campaign contributions to those able to vote in the elections.  The corruption of our political process is getting worse and until we can weed out the money from outside our constituencies, (including Russia) it isn’t likely to improve.

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