Prerare To Be Surprised
General perceptions often are that health insurers profit only at the expense of their policyholders vis a vis denied claims. This week industry trades reported second quarter results for managed care companies. As a percentage of revenues, earnings for three of the larger managed care companies were as follows:
* Humana 2.0%
* United Health 3.3%
* Wellpoint (Blue Cross) 4.3%
For your consideration: Are those 'excessive' earnings? As a business owner, would you be content with that ROI? More fundamentally, do you believe the profit motive creates incentives to run a health insurance company efficiently; ie. to compete on price and value? There are many who believe government would actually be more efficient than the private sector. Should one become dissatisfied with the financials of their insurer - say for example the executive compensation packages are unacceptable to you as a consumer - isn't it relatively easy to change companies? But what if, after switching to a government run health plan, we become dissatisfied with the inefficiencies of bureaucratic malaise. How do we change plans then?
As a final thought, I'd ask you to compare the above earnings of those who finance health care to the health systems who deliver care. I'm fairly certain you will be surprised.
Labels: Legislation, Waste Fraud and Abuse
posted by Jon Rauser @ 4:12 AM
2 Comments
As President & Owner of a successful health insurance brokerage in downtown Milwaukee - 
2 Comments:
Jon,
Your point about freedom to change is excellent. Most larger insurnace customers (employers) review their plan every year and seek cometition every time they renew. Try that with the government. Government run healthcare gets more expensive every year, despite their decreasing reimbursement. I don't know the exact number, but I'd be willing to bet that it's a rate similar to what private rates are climbing.
We need some sort of answer, but I can't imagine that turning over healthcare to our government is the solution that's right for America. We are the land of free markets and opportuity. If the American public gets behind value driven healthcare (and has the information to do so) we can make a change that will reform healthcare without giving another freedom away.
Even small groups and individuals can change insurers, Eric. Maybe not always with ease but there are 'guarantee issue' rules for small groups, a myriad of individual plans and even the state Health Insurance Risk sharing Pool (HIRSP). The point is, we have CHOICES.
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