The Health insurance industry, like the pharmaceutical industry, is enjoying record profits for the third year in a row.
There’s no recession when you can charge cost plus and eliminate those who need to use insurance:
The UnitedHealth Group, one of the largest commercial insurers, told analysts that so far this year, insured hospital stays actually decreased in some instances. In reporting its earnings last week, Cigna, another insurer, talked about the “low level” of medical use.
Yet the companies continue to press for higher premiums, even though their reserve coffers are flush with profits and shareholders have been rewarded with new dividends. Many defend proposed double-digit increases in the rates they charge, citing a need for protection against any sudden uptick in demand once people have more money to spend on their health, as well as the rising price of care.
Medicynical Note: Part of the reason is decreased demand for services because of high deductibles and co pays.
What’s also likely is that businesses are, increasingly, not offering insurance as an employee benefit and/or the insurance offered is too expensive for those in low paying jobs. Our non-system is cleverly designed to push those with illness out of work sponsored coverage and into the individual market. For example if you become ill and can’t work for a time, you lose your work sponsored insurance. You can purchase it through COBRA but that’s much more expensive as are policies on the individual market. For those with marginal income (probably most of the citizens in a country with a median income of $50,000/year) insurance suddenly becomes unaffordable and unattainable just when you need it most.
Devilously clever are those insurance guys!