Blog on the Run: Reloaded

Friday, February 12, 2010 11:40 pm

Best health care system in the world

Filed under: We're so screwed — Lex @ 11:40 pm
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No changes needed here, folks:

In the midst of a deep economic recession, America’s health insurance companies increased their profits by 56 percent in 2009, a year that saw 2.7 million people lose their private coverage.

The nation’s five largest for-profit insurers closed 2009 with a combined profit of $12.2 billion, according to a report by the advocacy group Health Care for American Now (HCAN). …

The industry’s response is beyond lame. First, they try to change the subject by pointing out that health-plan profits make up less than 1% of the cost of health care. And they totally bypass the fact that their profits increased because they reduced the percentage of revenue they spent on actual health care, in part by booting a bunch of people off their rolls. (Not everyone who lost coverage did so because of insurers’ actions; some, for example, lost coverage along with their jobs.)

Meanwhile, in a down economy, some of these same insurers are jacking their rates up as much as 39%.

But, hey, we have the best health care system in the world! USA! USA!

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5 Comments

  1. But we all know that competition brings prices down, right?

    Comment by Tony Plutonium — Saturday, February 13, 2010 12:11 am @ 12:11 am

  2. Of course. Which is why the GOP is fighting it so damn hard.

    Comment by Lex — Saturday, February 13, 2010 12:41 am @ 12:41 am

  3. While health is wealth most of our people no good health and it is the reality that they have no wealth to keep health well. To keep good health we also need wealth. Health is wealth? Not always that!

    Comment by The Health Dude — Monday, February 15, 2010 9:18 am @ 9:18 am

  4. So Lex,
    For example, just for illustration let’s say all health insurers had sales of $100 million in 2008. They had a profit of say 660,000. By your statistics in 2009 with the same revenue of $100 million and a 56% increase in profits. They made a shameful $1.03 million dollar profit or the 1% margin quoted by the industry. In most enterprises a 1% net margin is tantamount to financial collapse, and is not enough to sustain long term replacement of depreciable assets. It is so bogus to quote percent increase in profits as proof of malfeasance, but the favored tactic of the economically ignorant. Misuse of funds, raping the stockholders, or unearned bonuses however are fair game for criticism. I’m sure the stockholders in any enterprise are delighted when the managers of their holdings maximize their returns. (That includes most of working America with money invested in IRAs 401ks, or any other pension instrument) It’s so hilarious to hear the haters of corporations decry their profits when they are successful in one breath and in the next criticize them for their mistakes in the next breath. (i.e. Toyota one of the best run enterprises in the world) The biggest Ponzi scheme in the history of civilization is the US federal budget. Why would we let them manage our health care?
    Wow a 56% increase for a whopping 1% return.

    Comment by Jon Firebaugh — Monday, March 8, 2010 11:59 pm @ 11:59 pm

  5. Actually, in a number of high-volume industries, 1% is considered a pretty good deal (supermarkets, for instance).

    Here’s the more relevant number: 34%. That’s how much of our roughly $2.5 trillion spent annually on health care is going for insurance company administration and profit, and it’s the main reason why our per-capita health-care costs are so much higher than those of other industrialized countries whose health care outcomes are superior to ours. As for raping the stockholders, it’s the rule, not the exception: Corporate governance in this country needs a serious, serious makeover.

    Comment by Lex — Tuesday, March 9, 2010 5:40 am @ 5:40 am


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