Effect Measure

Health insurance companies shouldn’t exist

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.

Comments

  1. #1 K
    February 13, 2010

    Couldn’t agree more! Thanks

  2. #2 MartinDH
    February 13, 2010

    Hear! Hear!

  3. #3 Rose Colored Glasses
    February 13, 2010

    An insurer who refuses to pay a valid claim commits fraud and should be imprisoned for his crime. An organization that defrauds people paying insurance premiums without getting insurance should be prosecuted under the RICO statutes, which would allow prosecutors to seize all assets of everyone making any money in the racket, which would include stockholders.

    The health insurance racket sells counterfeit insurance to desperate people, swindling them out of what they are paying for.

    So why won’t the racketeers be punished? Every judge, prosecutor, and cop in this country likes his health insurance because it pays out more than he pays in.

    The entirety of law enforcement and the judiciary of the nation has been bought off. There is not one cop in this country who will take a crime report when an insurance company swindles a victim. No prosecutor worries about behind handed such a case, nor would any judge hear such a case.

    The insurance racket bought off everyone who could cause them trouble. Al Capone wasn’t that smart.

  4. #4 yogi-one
    February 13, 2010

    (Warning: angry voter screed follows)

    Another organization that should be dissolved: Goldman Sachs. And again, Obama is their man, who thinks his job as President is to transfer as much of the taxpayer’s money into their pockets as possible.

    It’s the same game as the insurance companies – investmant banking (read: gambling) with the public’s money, then privatizing the gains and socializing the losses.

    And the press just plays along. I can’t believe it. I’m reading headlines like “Obama talks tough to banks”. Who the heck do they think they’re fooling?

    It’s the same old game – serve the corporate masters, then lie to the public. Obama was specifically elected because he promised to change that.

    If you really want someone to hate you, one of the most effective things you can do is bait-and-switch them. And that’s how a lot of people who voted for Obama are feeling these days. Now remind me …he got a Noble Prize for what, exactly? He should return it. THAT would be an honest thing to do.

    It’s Obama’s idea that you and I should pay for these guys to bankrupt the country that may cause me to turn and vote against him next time. Except the GOP will probably, as usual, find their own version of the Worst Possible Candidate.

    So our “democracy” gives us the choice of which party we want to get screwed by. But the screwing is the same either way, it turns out. Bankrupt the country, feed the insurance companies and Goldman Sachs, create endless foreign wars, and lie your ass off to avoid taking responsibility. The Democrats are proving they are just as good at it as the Republicans.

    Sigh…what’s a voter to do?

  5. #5 Alex
    February 13, 2010

    I’m happy that in Canada we’re not prey to the same corporate criminals that you have in the US. Unfortunately, our government is trying to privatize our health care system as well. There is much opposition to it and hopefully we will not end up like in the US. What you need is some kind of French Revolution to oust the insurers and Big Pharma.

  6. #6 MoM
    February 13, 2010

    Revere,

    Do I understand correctly that you don’t believe that insurance companies are the reason we have the best health care in the world? You need to listen more closely to Senator Lieberman

  7. #7 MoM
    February 13, 2010

    Darn! There was supposed to be a </sarcasm> at the end of that post

  8. #8 Repod
    February 13, 2010

    Insurance companies sue can be a pain in the ass alright. Every year my premium goes up and my benefits go down. My insurance only pay 50% of an emergency room visit. They blame it on people who go to the emergency room with a cold or something not linked to an emergency. That’s fair enough I guess. I do wish someone could do something to lower the cost of healthcare, but I hate single payer socialist marxist systems. They are more corrupt than the insurance creeps. Maybe if we could 100,000,000 people together as a group and agree to drop all insurance – health, car, house, property, etc. and make the insurance companies beg for a while, we might could strike a deal with them. Until then, don;t look for things to get any better. In california, Blue Cross just increased their rates by 39%. If I were on that insurance I would definitely tell them to go fuck themselves with a red hot horse dick. I think they are secretly turd burglers.

  9. #9 Paula
    February 13, 2010

    Glad we’re all agreed. Alex has good idea here. So did the Tupameros, you’ll remember (well, some of you will).

  10. #10 Nico
    February 13, 2010

    Uh, repod: I live in Canada, which is one of those (incorrectly) classified as socialist.

    In my lifetime thus far: coverage of drugs and procedures has expanded in accordance with advances and developments in medicine.

    And: my out of pocket costs have not increased, and perhaps even decreased with expanded prescription assistance my ( incorrectly considered by you) corrupt system has offered. If there are increases, they haven’t been in the percentages as seen by US insurers.

    Oh, and I’ve never. ever. been denied anything my doctor deems nessesary, I need not appeal or petition for preauths.

    So I’m just not sure how a “socialist” system is more corrupt than the insurers in the US, who have dropped coverage of most people I know there, or will be in the coming months.

    (if you consider our rationing corrupt, there always is limited service at some points for a large population but our critically ill are cared for, wait lists are getting shorter and I’ve been able to see a doctor far easier than my US cohorts, where rationing is based on your bank account.)

    The insurers in the US have had plenty of time and voices urging them to change and they’ve done the polar opposite of listen, so I really don’t think much will change unless they experience some severe legislative kneecapping.

  11. #11 Alex
    February 14, 2010

    I would like to mention that most countries on the planet, including Canada where I live, use the so-called “socialist healthcare system”. Repod only stated here the usual American biases when it comes to socialism, which are perpetuated by the mainstream media in the US. Corporations in the US have been very successful at persuading the average person of voting against their own interests in matters such as healthcare. Big Pharma and Big Insurance work together to perpetuate the idea that privatized medicine is paradise on earth and that nothing must be done to change it. This is absurd and unjustified optimism. Again, like I said earlier, what you need is a form of French Revolution. Here’s a thought from that exact time period aimed at destroying unjustified optimism:

    “All events form a chain in the best of all possible worlds”, said Pangloss.
    “‘Tis well said,” replied Candide, “but we must cultivate our garden.”

    – Candide, Voltaire.

  12. #12 Tony P
    February 14, 2010

    And it is only going to get worse now that the USSC has said corporations can actually BUY an election.

    We’re fucked in the U.S.

  13. #13 peggy
    February 14, 2010

    When a government is complicit in the death and suffering of its own citizens by allowing a situation where millions have no access to health care, it should be replaced with a more humanitarian government.

    When the welfare of the citizens of the country is no longer the priority of the government, it should be overthrown.

    The sooner, the better.

    That we tolerate this crap is a moral outrage.

  14. #14 K
    February 14, 2010

    Repo just to add to the comments of those who live in Canada, “Canadians strongly support the health system’s public rather than for-profit private basis, and a 2009 poll by Nanos Research found 86.2% of Canadians surveyed supported or strongly supported “public solutions to make our public health care stronger.”[5][6]”
    http://en.wikipedia.org/wiki/Health_care_in_Canada
    Meanwhile I am just counting the years until I can sign up for the US “socialist” single payer health care plan called Medicare. My husband is already on it and it is better than any private insurance I have ever had. I even heard one person protesting health care reform by saying “don’t get your hands on my Medicare” which shows either the stupidity of some Americans who don’t understand that Medicare is single payer health care OR the success of the Insurance companies to demonize single payer. Or most likely both.

  15. #15 pft
    February 14, 2010

    I agree completely (note to self, check vitals).

    And how many people know insurance companies are exempt from anti-trust regulations and can collude on pricing. No wonder prices just keep going up, there is really no competition to control prices.

    And yet Obamas health care is really just a big gift to insurance companies, more customers (under threat of fine and/or jail time), and no cost controls, so those who are healthy can pay more for those who will be covered with pre-existing conditions. Also, the tools to gut medicare and deny health care to those who need it are in place.

    Medicare for all is the only way. Supplemental insurance as used in so called “socialist” states can be bought for those wanting better health care.

    But we are a government of the corporation, by the corporation and for the corporation. Citizen workers are just wage slaves, allowed to vote for those chery picked corporate candidates, and give up 50% of their wages on the various taxes or insurance premiums.

  16. #16 SusanC
    February 16, 2010

    I live in the UK. I complain all the time about the state of the NHS. But I am even more appalled at the state of healthcare delivery in the US.

    For example, a little while ago, I looked at fatal cases from 2009 H1N1 http://www.newfluwiki2.com/diary/4162/pulmonary-pathologic-findings-of-fatal-2009-h1n1-infections In the biggest published autopsy series of H1N1 deaths, from NYC (available here), of the 34 cases studied, 13 died before admission to hospital, ie > 1 in 3.

    A different paper on confirmed and suspected deaths from H1N1 in England (available here) also reported 13 deaths either in the community or before admission to hospital, but the denominator (total deaths) in this case was 138, ie less than 10%.

    I know the figures are not strictly comparable, but they are disturbing nonetheless. To me this lifted a corner of the veil, gave me a glimpse of the consequences of a profit-driven healthcare system – a more accurate description than ‘market-driven’ IMO

  17. #17 KeithB
    February 16, 2010

    I think that one of the first reforms to be passed would be to force insurance companies to have *one* risk pool for all their insureds.

    After all my fire insurance company lumps me in with all their other customers, why can’t health insurance companies?

  18. #18 Peter - Life Quotes
    September 15, 2010

    That’s a very good question. Why can’t every citizen in the US be considered part of the “group”?

    It makes no sense that we can’t do this other than to charge individuals insane rates on their coverage.

    How hard would it be to make each state it’s own group? Or the entire US? You live in the state, assess the risk and give us the rates. End of story.

  19. #19 Ryan
    May 4, 2012

    Amen brother.

    Unfortunately you’re howling at the moon.

    Americans are not bright and don’t want to be. Life in our country is a morality play.

    If you ‘work hard’ and save, you will be financially rewarded.

    Those who are down on their luck, including job loss or sickness, need to ‘pull themselves up by their bootstraps’.

    When folks see the world this way, do you think they’ll ever come around to logically thinking through a problem based on CAUSE and EFFECT? Unfortunately, no.

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