There is no magic bullet for health care, folks. Insurance companies are easy to blame, but one HAS to consider the costs involved with actually providing care.
My wife is Type 1 diabetic; her prescription is 300 monthly test strips and the PPO copay is $30. A blood sugar test strip costs about $0.05 to manufacture, according to a family member who previously worked for a large diabetic care company. Retail cost of those test strips at a pharmacy or retailer is about $1 per strip. And hospitals charge insurance companies $8 for that same test strip.
But hospitals, even for-profit ones, aren't exactly rolling in cash reserves. Their negotiated rates with insurance companies (including Medicare/Medicaid) help cover the cost of indigent care.
Combine this with doctors wanting to run all sorts of expensive (and often unnecessary) tests/procedures and a society that has an unhealthy diet & lifestyle and you get double-digit increases in insurance premiums year after year.
Insurance costs & coverages are a symptom of the problem...not the root cause.
You are correct in a lot of ways. But, the system of private insurance as our primary means of financing health care is disasterous and horribly inefficient.
It has been said by conservative "news" sources that private health insurance only has a 1-2% profit margin, but this is an incredibly misleading statistic.
Health insurance is just a means for financing health care. In its most simple terms, they take IN money from premiums (basically ALWAYS paid out of workers salaries, your employer doesn't actually pay it, you do), and money going OUT.
The money going IN is simple, its premiums. The money going OUT is in two buckets. The first is to pay doctors and pharmacies (the good part), and the second bucket is profit (supposedly 1-2%)
AND OVERHEAD.(another
17-21%)...
Conservative "news" never mentions the very significant overhead, which is measured in billions nationwide, and not ONE penny of overhead pays a doctor or pharmacy. If I recall, their are hundreds (had heard 1300 at one point) of private health insurance companies nationwide. Each company, especially the large ones, have a CEO, other executives, glass and marble headquarters, teams of lawyers, teams of lobbiests, salespeople, plan designers, plan administrators, and much more that I can't even imagine.
They spend incredibly amounts of money on things that have NOTHING to do with providing health care. In fact, they spend incredible amounts of money to AVOID spending money ON healthcare (lawyers exploiting contract loopholes, lobbiests lobbying to avoid mandates and restrictions).
Large health insurance companies don't even take on much risk. They will only take you if you are healthy (unless you are on a group plan, sorry if you are self employed), and they always adjust their premiums to more than cover their expenditures.
If you are still hung up on the 1-2% profit margin, remember that is calculated AFTER stock dividends and executive compensation. For example, it is entirely possible that a company could have a 5% profit margin with executive comp at 1 million dollars, but only 1-2% after a executive comp at 5 million... They can make the numbers look any way they want....
The argument of hundreds of health insurance companies competing with one another holds NO water. Their is NO inovation in insurance. They take in premiums, spend billions of dollars on unrelated things, and try and MINIMIZE what they cover and pay for. At the end of the day, the people PAYING the premiums (US workers) cover ALL of the costs of providing the care (thats good), and also pay ALL of the costs of maintaining hundreds of insurance companies and ALL of their overhead (that really bad)... In fact, those PAYING the premiums PAY for the lawyers and lobbiests that work diligently AGAINST the interests of those paying the premiums.... It is amazing.
So, WE pay in premiums, the insurance company spends BILLIONS industry wide on things that do nothing for us, our system, our care (and spend money on lawyers and lobbiests to work against US), and then pay SOME of OUR money back on our behalf to doctors and pharmacies.
Military Tri-Care and Medicare have estimated overhead expenses of around 2% (unless you get your estimates exclusively from the Heritage Foundation). They are incredibly popular by those that USE them. For every 100 dollars in taxes (premiums) those plans take in, approximately 98 dollars goes to doctors and pharmacies.
For every 100 dollars private insurance companies take in, approximately 78-85 dollars goes to doctors and pharmacies.
This is mainly due to economies of scale and the absence of executive comp, duplication (hundreds of companies doing the same thing, each needing a headquarters building etc... for example) and the absence of lawyers and lobbiests to avoid paying claims.
Sorry, its not idioligical, its just math. And fact.
Now before the mis-informed pipe up about Medicare, it is UNDERFUNDED,
NOT INEFFICIENT.
Why is it over-budget and underfunded. Well WHO does it cover? Everyone is OLD, with pre-existing conditions (all of them, they are OLD, that is a pre-existing condition itself), and in need of lots of expensive health care.
80% of the population would consume ALL or nearly ALL of their retirement income in their later years just to cover the cost of a private health insurance plan with their own money. That is IF THEY COULD EVEN GET A PRIVATE COMPREHENSIVE PLAN IN THEIR 70S-80S.... Most likely, without legislation opposed by Republicans, seniors could not get a private policy because of their age and pre-existing conditions. And after age 65-70, the premiums would be SO prohibitably expensive, that seniors simply could not pay for it. It is statistically normal for an elderly person to consume more health care dollars in their final year of life than they did for all prior years combined. For this reason, as people age start approaching the statistical life expectancy, the premiums become exponentially more expensive (not a linear increase like in early life).
Regardless of your political affiliation, Medicare is INCREDIBLY important for nearly ALL of us when we reach retirement age. Any reasonable and thoughtful person should be horrified to even imagine how life for ourselves and our parents and grandparents in retirement would be without it in todays America. If you are not horrified, you simply don't know any better.
Knowing how CRITICAL the program is (and understanding how truly efficient it is at converting premiums into doctor and pharmacy payments), look at your next paycheck and see the PALTRY withdrawal to fund such a critical program.
It is underfunded and over budget because:
1. Everyone on the program is OLD and in need of expensive care.
2. We pay VERY little into the program from our paychecks.
3. The underlying cost of care and prescriptions has increased WAY faster than wage inflation.
We NEED to fund the program and get the underlying costs of care and prescriptions under control.
None of this directed at boilerup.
Or, you can just have BLIND faith that we are the "best" and BLIND faith in what Fox "News" wants you to believe.
