Health Care: Do You Prefer Single-Payer Bureaucracy or Profligate Greed?

What's worse, having a government bureaucrat between you and proper health care, or having a corporate bureaucrat? When health insurance companies' allegiances shift away from people who need health care and toward pleasing their investors, you get the kinds of runaway health care costs that we have in the United States today. In a day of rampant greed and immorality, I don't hold out much hope that a government directed, single-payer health care plan will be any better than what we currently have, but I'm starting to think that it couldn't be worse, either.

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Have your costs for health care seemed to outpace your standard of living over the last decade or more? There are several contributing reasons, but one of the greatest is that greed for profit has seeped into the health insurance industry until it has become a flood.

Medical loss ratios measure how much insurance companies lose to administrative costs. In the 1990's 95% of costs paid for actutal health care in early 1990's, so the medical loss ratio was only about 5%. These ratios have risen until now nearly 20% of insurance premiums go to cover administrative costs. With some individual companies, the administrative excess is nearing 25%. In contrast, according to Wendell Potter, who was an executive at CIGNA insurance for 15 years, medicare has only 3% administrative overhead costs. Mr. Potter, who spoke with Bill Moyers recently, left CIGNA after his guilt got the best of him.

In days gone by, Potter told Moyers, health insurers cared most about those they insured. Now, they care most about their bottom line. Trimming true insurance in order to appease shareholders and to pay out gigantic bonuses to executives has begun to ruin not only these companies but also health care in America. Investors in health insurance stocks have primarily become large institutions, to include major, demanding hedge funds. Insurers often feel intense heat from such investors, who think they have not denied enough claims. It is becoming standard fare for insurers, bowing to these investors, to raise premiums so high that employers can no longer afford to insure their employees, or the insurers simply drop large groups of policy holders outright. The cancer that is destroying Wall Street is bringing the health industry down with it.

The main problem, however, is not that health insurers are greedy. The main problem is that so are most politicians. The solution, therefore, can not be simply to turn the reins of health care over to government. The solution has to be for Americans to stop being dictated to by their elite overlords, but rather to demand fairness and integrity. We should demand insurance only from companies that care about people instead of profits. And in order to get the health care regulation that we need, we should sweep the floor of congress clean with the broom of any angry vote.

Neither single-payer health insurance, nor any other form of social direction of health care dollars will work any better than the debauchery that exists in the America's private health insurance industry. Honesty and integrity are our only hope.



Comments

  1. Probably without realizing it, you've made a great argument against capitalism in general. Profligate greed is not restricted to the health care industry. All companies try to please investors and focus on the bottom line.

    That's why we need a public option in ALL industries, not just health care, because corporate greed and profits hurt all of us who are not rich. It's time to get rid of profits and immorality and let the people, through their government, run the economy.

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  2. You seem to have missed my main point. It is not capitalism that is the problem. It is immorality. The same people who run our private institutions take part in running our governmental institutions. If we don't root out corruption in both places, we have no chance.

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  3. Thanks, Frank. I appreciate your willingness here to consider the facts rather than stubbornly adhering to ideological dogma.

    On the same note, I'm becoming more persuaded to give the free market a greater role in some aspects of the free market, along the lines of David Gratzer's suggestions. The arguments and data backing them up are pretty compelling. Of course, considering the fact that Gratzer still sees the government playing a vital role in ensuring health care aged and disabled are funded in his reforms, I don't know that I really consider it a strong free market position. I don't see why we shouldn't give such a plan a chance, given that the sort of nationalized health care we extreme liberals tend to support won't make it through conservative resistance, it couldn't help but be a significant improvement from what we have now, and we can and should make sure that there are regular audits and accountability to ensure it is working as it's supporters predict--if it isn't, then we go back to pushing for a nationalized plan.

    (btw, When you say the problem isn't capitalism but immorality, you are splitting hairs a bit, what with capitalist theory actively encouraging selfishness/immorality)

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  4. We've seen plenty of examples of humane capitalism where businessmen act with honor. The problem here seems to be the barriers that prevent consumers from switching to better (more humane and honorable) insurance companies. If health care reform can address that issue, we'll have made a huge stride indeed.

    The costs that doctors and hospitals charge are frequently mind-boggling. I will readily admit I don't understand why they charge so much; I do know that I pay less because my insurance company has negotiated better rates.

    I'm blessed with wonderful insurance, but I wish it didn't have to be coupled to my employment.

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  5. Derek,

    I'm not sure how you see that capitalism encourages selfishness. The capitalism that Adam Smith saw as being the Wealth of Nations certainly does not. It cannot, because selfishness destroys wealth.

    Bradley,

    I completely agree with your sentiment. Severing health insurance from employment would be one of the best things we could do. With my company, I pay $16,000 per year for my family's health insurance. We come nowhere close to using that much. If I could get my company to put into my salary the amount it currently pays for my health insurance, and if it required me to find my own health insurance, I would be much better off.

    A huge percentage of those 46 million Americans who do not have insurance is because they lost their jobs. This problem should be corrected.

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  6. part of the high hospital and doctor fee's is related to the mind boggling high none payment rate, their is a huge number of people who will never pay due to inability after an emergency situation. The rest of us pay for those people in the form of higher fee's. Their are many cases for affordable preventive care could also save the system as a whole alot of dollars in the long run.

    The wall street model doesn't work for health care. Maybe a different market model could but I don't trust that congress could create such a thing. Perhaps a new form of LLC that is none-direct pay but rather bonus payout based on health outcomes.

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  7. Bradley: The reason that healthcare providers charge so much is because of insurance companies. The problem is that insurance typically only pays a percentage of "usual and customary" fees for any given procedure. This means that the doctor needs to raise his rates to 1) inflate the amount to be paid by insurance and 2) recoup some of that lost money from other patients. Insurance has made things more expensive, not less.

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  8. In that same vein is the fact that Medicare and Medicaid pay the least amount of any provider by a large margin. Which means we pay for those programs in our paychecks and then again in our premiums.

    Also noteworthy is that while costs are high, to us they're only as high as our deductible. Once our limits are met, someone else is paying for them. That third party status creates incentives to bill more as well.

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  9. Cameron,

    I wonder if Medicare/Medicaid's low payout is one way that the government can claim to have low admin costs. That may increase our premiums to pay for what the government won't pay for, but the fact still remains that the medical loss ratio has skyrocketed. I'm not sure the way to solve the problem, but I guess an economic collapse--whose way was paved by rampant economic immorality--can solve it for us if we can't.

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