Robert Reich: The Choice Ahead: A Private Health-Insurance Monopoly or a Single Payer

[eridani]

http://www.nationofchange.org/2015/07/06/the-choice-ahead-a-private-health-insurance-monopoly-or-a-single-payer/

Last week, Aetna announced it would spend $35 billion to buy rival Humana in a deal that will create the second-largest health insurer in the nation, with 33 million members.

The combination will claim a large share of the insurance market in many states – 88 percent in Kansas and 58 percent in Iowa, for example.

A week before Aetna’s announcement, Anthem disclosed its $47 billion offer for giant insurer Cigna. If the deal goes through, the combined firm will become the largest health insurer in America.

Meanwhile, middle-sized and small insurers are being gobbled up. Centene just announced a $6.3 billion deal to acquire Health Net. Earlier this year Anthem bought Simply Healthcare Holdings for $800 million.

Executives say these combinations will make their companies more efficient, allowing them to gain economies of scale and squeeze waste out of the system.

This is what big companies always say when they acquire rivals.

Their real purpose is to give the giant health insurers more bargaining leverage over employees, consumers, state regulators, and healthcare providers (which have also been consolidating).

The big health insurers have money to make these acquisitions because their Medicare businesses have been growing and Obamacare is bringing in hundreds of thousands of new customers. They’ve also been cutting payrolls and squeezing more work out of their employees.

This is also why their stock values have skyrocketed. A few months ago the Standard & Poor’s (S&P) 500 Managed Health Care Index hit its highest level in more than twenty years. Since 2010, the biggest for-profit insurers have outperformed the entire S&P 500.