Who is getting rich from health issurance?

[TriPolar]

@Balthisar

@Mozart1220

And therin lies the problem. The stockholders are more important than the “customers”. Can’t pay on claims because the stockholders have somehow been guaranteed a profit. I didn’t know that’s how the stock market worked.

That’s how all for profit corporations work. Sure, they do what they can to try to please the customer without affecting the bottom line, but the bottom line is why companies exist. Some companies may appear altruistic (consider how major corporations are “going green”), but that perceived altruism has the specific purpose of making the stockholders more money.

Stockholders can be greedy, and short sighted. But generally they will be concerned about actions that degrade the company’s customer base. Health insurers have no such concerns without free enterprise constraints. And the lack of direct payment by the consumers magnifies this problem. Few people have a choice of insurers.

[Dangerosa]

@Mozart1220

@Balthisar

It’s pretty unimportant what they make; CEO salaries – even highly inflated ones – are a tiny, little, itty, bitty percentage of revenue, and still a very small percentage of the net. By my standards, sure, most CEO’s are pretty damned rich, but the CEO isn’t the owner of the company;*** the stockholders are. ***That’s you, me, your pension plan, our 401(k) funds, and a heck of a lot of other people and investors.

And therin lies the problem. The stockholders are more important than the “customers”. Can’t pay on claims because the stockholders have somehow been guaranteed a profit. I didn’t know that’s how the stock market worked.

A corporation is obligated to meet their legal and debt obligations first. That would include paying out any contractually obligated claims if you were a health insurance company. If they aren’t, they are engaging in fraud. Not a good thing for the officers - who can face prison time, or the shareholders, who can see their investment go South fast. Now, they can try and avoid paying those claims, and they might, but they can’t do so in a fraudulent manner - they just set up enough hoops where you say “damn, I’ll just pay it.”

But they are also LEGALLY OBLIGATED to look after the interests of their shareholders, who are assumed to be interested in a for profit venture in most cases. If they don’t, they can face a shareholder suit. Shareholders, however, have not be guarenteed a profit. By law, shareholders are not paid first, liabilities are paid first.

You aren’t alone, btw, most people don’t realize that a publicly traded corporation has a fiduciary duty to look after their shareholders - but no duty to look after their customers - except as that meets the ends of looking after their shareholders and meeting legal obligations (the insurance industry has a TON of legal obligations, from coverage contracts to regulation).

[Wesley_Clark]

corporate CEO pay is a very small part of why our health care is so expensive. My understanding is $800 billion in care does nothing to improve our quality of life, and may actually make it worse. Even if you subtract CEO pay, it would barely make a difference.

We just have an extremely wasteful, inefficient system. Plus it was designed around making money, so all these different groups (physicians, hospitals, pharma companies) have an incentive to sell the most expensive procedures & devices possible rather than the highest quality care for the lowest price.

Atul Gawande writes well on the financial flaws of our health care system. I would look into some of his articles.

[BayouHazard]

This horribly complicated, bloated, inefficient, wasteful, and nasty system in which we pay for “healthcare” and then fight health insurers to cover the treatment we supposedly paid for is why I am, and will probably continue to be, for some form of single-payer.

Right now, I’m in the more interesting predicament of not having my company offer insurance that’s worth me actually buying:

-It covers a max payout of 35$ a month for prescriptions-while retail, my scripts would run around 700 total, monthly, for maintenance meds ALONE . If I actually get a bacterial infection, throw in another 100-700 for antibiotics.
-$2000 total yearly hospitalization. You can’t get treated in an ER and walk out for $2k.

I’m trying to get surgery through the county low-income system right now. It’s a hit-and-miss bureaucracy, and getting care through them is like a part-time job, really. But I pay 10$ a script, $10 for appointments, and if I manage to get them to schedule my promised sinus surgery, it will cost me $100. After the surgery, I may not need all the meds, we hope.

Maybe we Americans should study the Swiss system. I understand they DO have private insurers-but they are very regulated, all people are covered, fees are sliding-scale, and their insurers manage to remain in business.

Anyone here know how that works?

[BayouHazard]

Oh-the insurance I mentioned in that post above? I’d get $135 taken bimonthly for that.

Would you buy that insurance?

Before I was with the county I bought my meds illegally online. It cost me one-third what it cost me to buy the same meds, by the same manufacturer, at the pharmacy in my local big-box-store.

They were made for Germany, New Zealand, and Australia.

[Damuri_Ajashi]

@TriPolar

This problem pervades the insurance industry. Insurance is basically a form of gambling. Like the problems associated with financial derivatives, the incentive to get something for nothing becomes dominant. The heart of the health care crisis we face is the overwhelming cost of all possible health care that could be provided to people if no standard of need or efficacy is applied.

Health insurance (all insurance actually) is supposed to be a form of communal savings. Money doesn’t magically appear from nowhere, it is collected in the form of premiums, it is invested and benefits are paid out to those who need it. Its a form of communism, everybody chips in and those who need it dip into the pot.

The problem is that insurance companies have a built in inefficiencies. Long ago insurance companies figured out that it is FAR more profitable to insure healthy people with lower premiums than sick people with high premiums. So they spend a lot of money “underwriting” folks so that they can cherry pick the health risks. Then they spend a whole other basket of money denying claims. Then they spend another basket of money kicking out the sick people. Then they spend another basket of money paying off the shareholders and executives. After all that they have some money left over to pay the doctors and hospitals.

[Damuri_Ajashi]

@Mozart1220

@Balthisar

It’s pretty unimportant what they make; CEO salaries – even highly inflated ones – are a tiny, little, itty, bitty percentage of revenue, and still a very small percentage of the net. By my standards, sure, most CEO’s are pretty damned rich, but the CEO isn’t the owner of the company;*** the stockholders are. ***That’s you, me, your pension plan, our 401(k) funds, and a heck of a lot of other people and investors.

And therin lies the problem. The stockholders are more important than the “customers”. Can’t pay on claims because the stockholders have somehow been guaranteed a profit. I didn’t know that’s how the stock market worked.

It is if the CEO wants to keep drawing his 7 million dollar salary.

[Really_Not_All_That_Bright]

@Balthisar

@Mozart1220

And therin lies the problem. The stockholders are more important than the “customers”. Can’t pay on claims because the stockholders have somehow been guaranteed a profit. I didn’t know that’s how the stock market worked.

That’s how all for profit corporations work. Sure, they do what they can to try to please the customer without affecting the bottom line, but the bottom line is why companies exist. Some companies may appear altruistic (consider how major corporations are “going green”), but that perceived altruism has the specific purpose of making the stockholders more money.

There’s the rub: healthcare is not an enterprise.