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by twoodfin 4513 days ago
I don't understand what you're suggesting. If insurance costs were rising at ~15% annually while total expenditures were rising at ~6% annually, you'd expect to see insurance administration/profits become the #1 expenditure in short order. But per the CMS data I linked, those were only 6% in 2012 ("Net Cost of Health Insurance").
1 comments
jbooth 4513 days ago
Why's it have to come out as profits? Couldn't they just be a big lumbering bureaucracy that never gets cut because they never have pricing pressure?

Paying a bunch of idiots to run around and generate paperwork isn't profitable, but the money's still gone.

http://business.time.com/2009/09/16/health-insurance-premium...

Healthcare premiums up 131% in 10 years.. that comes out closer to 9% than 6%. And doesn't include co-pays or anything that insurance doesn't cover.

EDIT: For the record, this kind of industry BS is why liberals support single-payer healthcare. It's not that we're commies or even that we don't understand the inefficiency of government bureaucracy. It's that we'd prefer the dumb public bureaucracy to our current even dumber private bureaucracy. Something being 'private' without pricing pressure isn't capitalism.

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twoodfin 4513 days ago
Why's it have to come out as profits? Couldn't they just be a big lumbering bureaucracy that never gets cut because they never have pricing pressure?

Sure, but that would show up in the CMS numbers, and it doesn't.

Insurers are absolutely price-conscious, both of what they pay for and what they charge. It's not as if businesses will accept year after year double digit increases without shopping around. If there were big money to be made undercutting existing insurers, someone would go after that market, but there isn't: Health insurance profit margins are low single digits at best.

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dragonwriter 4512 days ago
> Why's it have to come out as profits? Couldn't they just be a big lumbering bureaucracy that never gets cut because they never have pricing pressure?

Not with the ACA limits on share of premium costs not going to care they couldn't. Before the ACA, they certainly could.

> For the record, this kind of industry BS is why liberals support single-payer healthcare. It's not that we're commies or even that we don't understand the inefficiency of government bureaucracy. It's that we'd prefer the dumb public bureaucracy to our current even dumber private bureaucracy.

> Something being 'private' without pricing pressure isn't capitalism.

Yes, it is capitalism. Its not free, efficient, competitive market, but its certainly capitalism.

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