Health insurance companies shouldn't exist

[dtotire]

Health insurance companies shouldn't exist

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Posted on: February 13, 2010 6:06 AM, by revere

2009 was a dismal year, economically speaking -- unless you were a health insurer:

If no health care overhaul passes Congress, health insurers may be in for a windfall -- and one far larger that most Americans probably realize.

According to a study by a pro-health reform group published Thursday, the nation's largest five health insurance companies posted a 56 percent gain in 2009 profits over 2008. The insurers including Wellpoint, UnitedHealth, Cigna, Aetna and Humana, which cover the majority of Americans with insurance.

The insurers' hefty profit gains came even as 2.7 million more Americans lost their insurance coverage due to the declining economy. (John Byrne, Raw Story)

Explanation, according to the insurance industry? In 2008 they took a bath in the market, so the comparison is artificially inflated. Gee, my retirement income took a bath in 2008, too. In fact I'm not doing that well in 2009, either. And that points up a fact usually not recognized: insurance companies are basically investment companies. They take our premium money and invest it between the time of receiving it and when they have to pay it out. The longer they get to hold it, the more money they make on their investments. And if they invest it poorly, they deny claims and jack up premiums to recoup the losses, or more accurately, the less than obscene profits. Last year the top five spent less a smaller proportion of their premiums on medical care and more on salaries, administrative expenses and profits. And they jacked up premiums, the most notorious being Wellpoint's Anthem Blue Cross California, up 39% for 2010. Wellpoint claimed they lost money in California last year but at the same time they posted a $4.7 billion profit. $4.7 billion. That's 4.7 thousand millions. Their 7.3% profit margin was highest of the big five. But they are still raising premiums 39% and considering paying a dividends to investors, not something companies that lose money usually do.

It is a commonplace to say government programs are notoriously inefficient and wasteful. The real truth is that premiums go farther in the single-payer Medicare program which insures people with high medical expenses (the elderly). Medicare doesn't have to make an obscene profit and spends far less in administrative expenses, many of which go to figuring out ways to deny claims. Private health insurers are among the most wasteful and socially unproductive businesses in the country. They provide no useful services of any kind. They are parasites.

I can't say enough bad about health insurance companies. They shouldn't exist. They are ruining the country. And the Obama Administration and the Congress -- all Republicans and too many Democrats -- just keep shoveling more money into their hungry maw.



http://scienceblogs.com/effectmeasure/2010/02/health_insurance_companies_sho.php?utm_source=nytwidget

[Myrina]

1. Agree completely.

:thumbsup:

[bemildred]

2. Those of us who are old enough remember that HMOs were sold to us

as a way to cut costs and be more efficient.

[dmallind]

3. I agree in principal with the OP, but in microcosm HMOs did do this

To accurately gage whether HMOs lowered costs compared to the alternative, we have to look at the costs of the alternative now, not the alternative decades ago. HMOs are indeed cheaper now. It's like saying the stimulus money did not create jobs because we have fewer jobs than when it was launched. The real measurand is the number of jobs we would have had NOW had it not been launched. That one is more subjective, but I'm confident it would be.....less.

That said, a single non profit with monopsony power would indeed cust costs and increase efficiency far more, and the only entity able to even potentially manage that would be governmental. There is indeed a reason we pay more per person for health care that mau be flashier but is less effective on the aggregate, and that is insurance companies (and competing private health providers not incentivized to lower actual costs) and their short-sighted policies.

[bemildred]

5. That seems like wierd, incoherent mumbo jumbo to me.

Single payer was the alternative back then too. If you are trying to suggest that health care would be more expensive now if we had stuck with the pre-HMO system, I'd like to see some sort of evidence and an argument for that. HMOs jack the rates up because they can, they have monopoly power, they are the bottleneck in the system, and they are about making a profit, nobody had that before HMOs were created. Government entities, despite their many flaws, have the single great virtue of not being profit-centered.

[dmallind]

12. Sorry. I will try to explain

Single payer has been a theoretical option for more than two centuries and would have been the best option at any time. Sounds like you agree.

But the choice is not always between best and no change at all, but between a lesser change and no change at all, or even between two lesser changes. If those lesser changes help, but not as much as single payer would, they still help.

Some sort of evidence is very easy. Shop around for health care prices outside your HMO and see if they are higher or lower. One thing we should clarify though is terminology. HMOs and Health insurers are NOT the same thing. There are non-HMO indemnity plans out there delivered by health insurabnce companies, as well as of course privately funded health care. Both are more expensive than HMOs. HMOs tend to increase utilization while reducing patient cost for a specific service. An HMO is properly defined as a plan that relies on pre-arranged participation from, and price agreements with, a subset of healthcare providers.

[bemildred]

14. The choices are always what the choices are.

The notion that one can somehow only get inferior choices needs support, you offer none, it is a bald assertion. We could have had the best choice, all Congress had to do is make it law. Lots of other countries have managed some form or another of that.

The fact that health care providers will try to screw people who have no coverage does not support the idea that we would now be worse off had HMOs not been given their monopoly control of the health care system. They screw everybody, not just patients. The fact that all of your choices suck now does not mean that HMOs do not suck.

[dmallind]

16. Why do *I* need to support that?

I mad4 no mention implicit or explicit of what choices should or could be available, but it is not a bald assertion to say that sometimes only suboptimal choices ARE - it is plain fact. For example no proposal for single payer has passed committees in Congress. Our only choices then are a weak bill with many issues or none at all at this time. Of course it's potentially possible that a better choice could be offered in a way that it could be made law, but that is not the choice we have now. There is no current choice of a single payer system. I wish there were.

And you are missing what I said about HMOS too. HMOs are NOT repeat NOT the only type of health insurance offered. You can buy traditional indemnity health insurance too. It will cost you much much more than an HMO. HMOs (properly defined, not used as a shorthand for health insurance in toto) are a cheapER (not cheapEST) method of covering healthcare needs. Your options right now in order of costs are:

Pay for yourself
Pay for indemnity insurance
Pay for an HMO
Hope you don't get sick

Now where incidentally did I say that HMOs do not suck? All I did was say they reduced costs over indemnity insurance. You can test that assertion for yourself - shop for both.

[bemildred]

17. OK, don't support it.

Make all the predictions you like with no evidence whatsoever. However, I must point out that predictions about future events are not facts. You ARE predicting that certain things cannot be done.

[Demeter]

4. And We Didn't Believe Back Then, Either

and were proved right, but they linger like the head cold....

[izquierdista]

6. And why didn't we believe it?

Consider the source....

[unblock]

7. excellect point about it not being "just" government programs that are inefficient and wasteful

mainly it's big bureaucracies that are inefficient and wasteful, and that happens both in government and in big companies.

but the real point is that, AT BEST, the private sector has an incentive TO DO WHAT? to maximize profits, that's what.
and it's often a long leap to get from the incentive to maximize profits to providing excellent products and services.

in the case of the health insurance industry, they maximize profits in part by INTRODUCING waste and inefficiencies. the more paperwork you have to fill out to get paid on your claim, the more hurdles you have to jump through, the more chance they have that you might give up or die. at worst, they pay out later rather than sooner, so they win either way.

[M155Y_A1CH]

8. We waste our health care dollars

All the talk of the so called reformers is to reduce the cost of this useless and unnecessary industry. Affordable insurance seems to be the push at the very time when insurance companies have been proven to be inefficient and even negligent in caring for the health of Americans.
Why do we need a middleman to determine the care we shall get. Doctors are proficient at determining what care is indicated and insurance companies are not. The companies have the wrong bottom line to assure good health care. They should be cut out of the process as waste.

[jtrockville]

13. The profit-takers would probably disagree.

They're getting rich from denying health care. What a screwed up system!

[Jamastiene]

9. The more I read about Health Insurance industry practices, the more I am reminded of the kid

who steps out from behind some hedges while another kid is on their way to school. Robber Baron Kid demands Traveling Kid's milk money or else Traveling Kid will be beaten to a pulp.

So, Traveling Kid either forks over the milk money or stands and fights.

If Traveling Kid forks over the money, he can get to school on time.

If he stands and fights, it'll be a big pain in the ass and he'll definitely be late for school and he'll miss out on part of his education for the day.


When we need emergency rooms, the time it takes to be roughed up by the person behind the desk (who WANTS MONEY, RIGHT FUCKING NOW, DAMMIT!!!) could have been spent getting helped while we stood there and bled to damn death.

Maybe everybody should pick a national day to call health insurance companies and give them a headache demanding better treatment. It would aggravate the hell out of them, but maybe if they saw more people fighting them back, they would change their attitudes.

[DirkGently]

10. How do you insure against

the need for health care? The idea of insurance is supposed to be that you pool premium against the risk of unexpected catastrophes. Fire. Car accident. Untimely death. But everyone needs healthcare, for their entire lives, and most people will develop some kind of chronic or emergent health issue.

We've built a system around an implied notion that you really shouldn't need to go to the doctor at all. And if you do, it's probably your fault. It's because you're fat. Or because you smoke. Because you're ... old? Because you foolishly inhabit a human body? I remember recently at the meeting at which my employer announced the slashing of our health benefits (how does a $5,000 deductible grab you) that we were gently chided for "using 40% more specialists" than some group or another. As though needing healthcare itself was a sign of self-indulgence or failure. In the following weeks we were deluged with helpful e-mails detailing how "you can get a UTI taken care of at a CVS pharmacy clinic!" "And Publix gives out free antibiotics on holidays and weekends!"

Neato.

[babyblonde]

11. WHAT IN THE HELL

do they produce.............0...nada,bupkis
DESTROY THE INSURANCE RACKET before it destroys us:mad: :nuke:

[eridani]

15. If some foreign country had killed as many Americans as insurance companies do--

--it would now be a radioactive parking lot. Their CEOs should be put up against a wall and shot.