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Thank you Acadialion. I do appreciate your expertise. You're right...there are several issues - hence the reason I believe "quagmire" is the kindest word to call it. I know AIG is a differing ballgame, and I do agree there are differing opinions on what is reasonable compensation, but when it comes to the anger of the masses, calling into question a multi-million dollar "bonus" for running a corporation into the ground is one explanation why healthcare reform is such a hot potato. The stresses of CEO's can likewise be compared to the stresses of the average household trying to keep one step ahead of the bills IMO. The Dirigo program, and all it's problems, has proved that healthcare reform is a hornet's nest for many. Maine saw that right up front.
Kracer's right. There really hasn't been anything substantial to look at as far as how it will impact Maine.
Acadian... I believe I first heard if from Dick Morris on O'Reilly one night... but found these links on the topic. Maybe you could make sense of it for us? TYIA!
CNSNews.com - Rockefeller Uses Health-Insurance Profits Statistic Calculated by ACORN-Backed Group to Make Case for Government-Run Health Care (http://www.cnsnews.com/news/article/52418 - broken link)
CNSNews.com - 400 Percent Profit by Health Insurers is Selective, ‘Meaningless’ Number, Say Analysts (http://www.cnsnews.com/news/article/52745 - broken link)
Acadian... I believe I first heard if from Dick Morris on O'Reilly one night... but found these links on the topic. Maybe you could make sense of it for us? TYIA!
CNSNews.com - Rockefeller Uses Health-Insurance Profits Statistic Calculated by ACORN-Backed Group to Make Case for Government-Run Health Care (http://www.cnsnews.com/news/article/52418 - broken link)
CNSNews.com - 400 Percent Profit by Health Insurers is Selective, ‘Meaningless’ Number, Say Analysts (http://www.cnsnews.com/news/article/52745 - broken link)
Ah, yes. I have seen this before, and saw the Potter interview when it first was held.
The first statistic is only relative. The actual statement that between one date and another...some years apart, health insurance industry profits ROSE from one level to another that was a total rise in profit of 400%. Sounds terrific: the actual number though is in terms of actual dollars not that great, and exactly which profit figure they are using as an example, is unclear. Certainly not the NET profit available for distribution to stockholders.
And yes, it could well be that many people became uninsured by those TEN major insurance companies in that time. The statistics for rising profit percentage only applied to the TEN largest insurance companies. Remember, there are more than 1300 different insurance plans and programs in this country. The entire industry didn't post large profits or ANY profits.
It wouldn't surprise me a bit if most of the major insurance companies elimiinated from their roles of policy holders a very large number of people. This can happen in two or three ways.
First of all, there are cancellations for non-payment of premiums. There is always a certain amount of attrition in all insurance areas from this one cause.
Secondly, the insurance company may well have chosen to NOT renew coverage for many people for many different reasons. Making claims is not usually one of those reasons, unless the number of claims is considered to be excessive. What is "excessive"? Well, I think most insurance companies would agree that there are two things that they fear the most: frequency and severity, and of the two, frequency of claims terrifies an insurance company of any kind. The reason is that frequency means that an awful lot of administrative handling goes into frequent small claims, and that often presents a much greater risk than the insurance company intended to underwrite to begin with. So if someone has appendicitis and an appendictomy, that is part of the game, but if this same process is piled on top of a dozen or more trips to the emergency room over a year, the case might be reviewed as severe, and if allowed by state law, the policy might be non-renewed because of frequency. This does not mean that that person is uninsurable. It merely means that that person is uninsurable by THAT company at THOSE rates. In most states there are options.
Thirdly, there is a common conception that anyone can buy insurance from the insurnce company if they are willing to pay the premium. This is true in Maine, but not in other states,a nd it didn't used to be so in Maine either. When companies "underwrite" they consider all factors in the applicaiton of an individual or a group. For instance, if the applicant is a high wire trapese artist, he may not be acceptable to the insurance company, just as a small employer who does certain type of building construction might not fit the business plan or Company A, or Company B, or Company C. But there might well be Company D that offers a preferred risk plan for such groups, and there might be another insurance company that doesn't care if the applicant is a high wire trapese artist, so long as he doesn't get shot out of canons in the off periods....and so forth: this is called UNDERWRITING, and in the past, groups of more than three employees were a fertile market for many insurance companies, and coverages were available that were very broad and premiums were manageable by small employers. When I owned my insurance business I automatically provided health insurance for my employees and they could add their spouses if they wished...most did. We had outstanding coverage, and delivered two babies under policies during the time that I owned my agencies. (I did NOT sell health insurance or life insurance in my business).
Unfortunately, the politicians and the talking heads on conservative talk radio want to find a villain, and they are lumping all of the insurance companies into one big pot. This is unfortunate, and when presented with an organized effort at cramming all insurance into one simplistic pot, the industry will circle its wagons and fight back. This happened when the Clintons tried their hair brained schemes, and is happening now, but by people who feel that they are being attacked by a big villian...the insurance industry...which is simply not the case.
Remember this: the insurance industry is a reactionary industry. The insurance industry does not set policy, nor regulate, nor control the business of delivering medical care to the patient. The insurance industry only analyses the risks involved with providing insurance to cover people who may or may not need medical services over a period of time: one year. If their statistical analyses, political analyses, and understanding of the medical community and how it works is correct, the health insurance MAY make a profit. If they are really, truly lucky and right, the profits may be quite large. But it can easily go the other way, too: imagine what might happen if this "Swine Flu" becomes a true epidemic, and there are two or three million people who are immediately chronically ill, and live that way a long time in recovery, but do not die. A year or two after that crisis ends, one should look back and see what the profit levels of the insurance industry was after all of those medical claims were paid.
Ah, yes. I have seen this before, and saw the Potter interview when it first was held.
The first statistic is only relative. The actual statement that between one date and another...some years apart, health insurance industry profits ROSE from one level to another that was a total rise in profit of 400%. Sounds terrific: the actual number though is in terms of actual dollars not that great, and exactly which profit figure they are using as an example, is unclear. Certainly not the NET profit available for distribution to stockholders.
And yes, it could well be that many people became uninsured by those TEN major insurance companies in that time. The statistics for rising profit percentage only applied to the TEN largest insurance companies. Remember, there are more than 1300 different insurance plans and programs in this country. The entire industry didn't post large profits or ANY profits.
It wouldn't surprise me a bit if most of the major insurance companies elimiinated from their roles of policy holders a very large number of people. This can happen in two or three ways.
First of all, there are cancellations for non-payment of premiums. There is always a certain amount of attrition in all insurance areas from this one cause.
Secondly, the insurance company may well have chosen to NOT renew coverage for many people for many different reasons. Making claims is not usually one of those reasons, unless the number of claims is considered to be excessive. What is "excessive"? Well, I think most insurance companies would agree that there are two things that they fear the most: frequency and severity, and of the two, frequency of claims terrifies an insurance company of any kind. The reason is that frequency means that an awful lot of administrative handling goes into frequent small claims, and that often presents a much greater risk than the insurance company intended to underwrite to begin with. So if someone has appendicitis and an appendictomy, that is part of the game, but if this same process is piled on top of a dozen or more trips to the emergency room over a year, the case might be reviewed as severe, and if allowed by state law, the policy might be non-renewed because of frequency. This does not mean that that person is uninsurable. It merely means that that person is uninsurable by THAT company at THOSE rates. In most states there are options.
Thirdly, there is a common conception that anyone can buy insurance from the insurnce company if they are willing to pay the premium. This is true in Maine, but not in other states,a nd it didn't used to be so in Maine either. When companies "underwrite" they consider all factors in the applicaiton of an individual or a group. For instance, if the applicant is a high wire trapese artist, he may not be acceptable to the insurance company, just as a small employer who does certain type of building construction might not fit the business plan or Company A, or Company B, or Company C. But there might well be Company D that offers a preferred risk plan for such groups, and there might be another insurance company that doesn't care if the applicant is a high wire trapese artist, so long as he doesn't get shot out of canons in the off periods....and so forth: this is called UNDERWRITING, and in the past, groups of more than three employees were a fertile market for many insurance companies, and coverages were available that were very broad and premiums were manageable by small employers. When I owned my insurance business I automatically provided health insurance for my employees and they could add their spouses if they wished...most did. We had outstanding coverage, and delivered two babies under policies during the time that I owned my agencies. (I did NOT sell health insurance or life insurance in my business).
Unfortunately, the politicians and the talking heads on conservative talk radio want to find a villain, and they are lumping all of the insurance companies into one big pot. This is unfortunate, and when presented with an organized effort at cramming all insurance into one simplistic pot, the industry will circle its wagons and fight back. This happened when the Clintons tried their hair brained schemes, and is happening now, but by people who feel that they are being attacked by a big villian...the insurance industry...which is simply not the case.
Remember this: the insurance industry is a reactionary industry. The insurance industry does not set policy, nor regulate, nor control the business of delivering medical care to the patient. The insurance industry only analyses the risks involved with providing insurance to cover people who may or may not need medical services over a period of time: one year. If their statistical analyses, political analyses, and understanding of the medical community and how it works is correct, the health insurance MAY make a profit. If they are really, truly lucky and right, the profits may be quite large. But it can easily go the other way, too: imagine what might happen if this "Swine Flu" becomes a true epidemic, and there are two or three million people who are immediately chronically ill, and live that way a long time in recovery, but do not die. A year or two after that crisis ends, one should look back and see what the profit levels of the insurance industry was after all of those medical claims were paid.
Thank-you for this thorough explanation. It all makes sense and the only thing I disagree with is your comment about conservative radio pundents.... the links I gave you are all left wing pundents. Especially that whack job Rachel Maddow... so I see this subject as something that is even dividing the left... not just the centrists or the right. When I googled 400% insurance profit, the links provided were the only ones to come up. No conservative links showed. Although I listen to conservative tv pundents, I do not listen to them on the radio.
Thanks again Acadian. Your knowledge of the industry is very helpful.
Thank-you for this thorough explanation. It all makes sense and the only thing I disagree with is your comment about conservative radio pundents.... the links I gave you are all left wing pundents. Especially that whack job Rachel Maddow... so I see this subject as something that is even dividing the left... not just the centrists or the right. When I googled 400% insurance profit, the links provided were the only ones to come up. No conservative links showed. Although I listen to conservative tv pundents, I do not listen to them on the radio.
Thanks again Acadian. Your knowledge of the industry is very helpful.
I agree the Right wing radio people are the ones saying what Acadianlion was professing in an earlier post that the insurance companies should be able to run their businesses as they see fit and make a profit doing so. It's the left and Obama in particular that want to run the insurance companies into the ground. That's exactly what a government funded public option plan would do. The guy with the most funding here wins and when you're the one printing the money the rest can't compete.
I agree the Right wing radio people are the ones saying what Acadianlion was professing in an earlier post that the insurance companies should be able to run their businesses as they see fit and make a profit doing so. It's the left and Obama in particular that want to run the insurance companies into the ground. That's exactly what a government funded public option plan would do. The guy with the most funding here wins and when you're the one printing the money the rest can't compete.
Pretty much. Not really good information coming from either side of the aisle on the radio or TV. I have felt that "Whine Broadcasting" (PBS) is giving a good assortment of information from a lot of different sources. Unfortunately the attempt is being made to make it a choice between "The Insurance Industry" and "the gummint 'plan'". I don't like the way the Democrats are going about this, nor do I like the way the Republicans are going about this. In the end, there will be "A" plan, but what that plan is, is a long way from shaping up.
Here is what I think will happen. The government plan will be a plan of last resort. It will NOT be a plan that is competitive with group insurance plans offered by insurance companies to employers. What it will be is a plan that will provide coverage people who do not qualify by income or chronic condition for "normal" underwriting, and it will be those people that the government provides basic health insurance coverage for.
There will also be major overhauls in the kinds of medical services that are given or covered by health insurance. Central data processing services MUST be installed making it unnecessary for the same cat scan, EEG, or chemical testing to be done at every level of of medical service. I expect that at some point an effort will be made to offer grants to medical service businesses that will offer a kind of "triage" to people needing to see a doctor. Instead of going to the emergency room, people will go to a local clinic for initial consultation of any one problem or another. Emergency rooms will remain for EMERGENCIES, of course, but the cost of iniital treatment will be far less when delivered in a lower level of medical service facility.
There is a huge amount of work more to do. The entire health industry needs to be revamped. Most doctors graduating from medical school now, do not go into family medicine, but become "specialists". What we need desperately is more family practitioners, but in order for that to happen, the lower pay rates of family doctors will need to be adjusted in some way. some scheme will need to be devised to change the paper work load of doctors so that they can spend time being doctors, instead of paper pushers. Perhaps the government will devise some sort of medical school tuition and expense "credit" system for doctors going in to family practice and staying there for some length of time. That would improve the level of basic care delivered, and reduce the impact and cost of initial and follow on visits and services to the patient.
The comment made somewhere else on this thread about the situation being a "quagmire" was absolutely correct: we have an aging population and the cost of medical services MUST be contained, or the financial destruction of the entire industry is assured.
Keep pestering your Congress critters and Senators. Don't settle for prefab gibberish from their aids or the generic form letter. We need to corner them on this. That weasel from Millinocket went on VOM the other day refusing to take calls on the health care as a prerequisite for the interview. Suzie Rino didn't have much to tell me about it when I ran across her last week. I do not trust the evil twins to do the right thing anyway. They will do just about anything to keep the commissary open at the defunct BNAS. Obama lies and grandma dies.
From what I have read recently, insurance company profits hover around 5-6%, no different than any other commercial enterprise. Malpractice insurance is through the roof. That is why most doctors will join a group practice to spread the expenses and risk around. I know several who took jobs with hospital and affiliated groups, leaving their own practices because at the end of the day, their paycheck was larger. I have several customers and friends in med school and residency now. They are coming into the field with $200k in debt. I know Nurse Practitioners and Anesthetists who make as much as some Doctors.
Doctors practice defensive medicine for fear of being sued. If people would expect fewer MRI's for simple strains and pains, and older, tested medications for common ailments, you can trim some fat out of the system. Without the Tort reforms, the other solutions are just band aids.
The volume of advertising by the drug manufacturers is staggering. I have a friend who reps for a German firm in MA. They manufacture a product similar to Advair, for COPD and competition is fierce. Obama is trying to buy off the pharmaceutical companies by promising to double the life of their patents. When the patent was due to expire on the "Purple Pill" which could then go generic, the manufacturer basically repackaged its chemical isomer (same molecule,) and sold it as the "New Purple Pill." This gave them an advertising edge for years to come. We could stop drug advertising to the general public, as much as I dislike that idea.
This isn't rocket science. Reform will come at a cost. People will need to have more skin in the game. This could mean higher co-pays, depending on what you want done that your physician doesn't deem necessary. Everybody should be responsible to seek out their own plan. Buy what you want or can afford to pay. Tax credits for those who need help paying, up to a point. If your employer supplies insurance, it should not be against the law to state exactly what it is costing them for that pay period on your weekly pay stub. When everyone realizes the true cost of their care, the costs will seek their own level. Yup, not everyone will be able to afford the Cadillac Plan, but not everyone can expect to own a Caddy, either. Nothing wrong with that. As with everything else in life, the Constitution does not promise equal outcome, just equal opportunity.
Believe me, HSA's and a small catastrophic policy is all most families need. You pay for your own routine treatments and your insured for the unforeseeable. Plus you have incentive to save tax deferred every month and can use the dough later for retirement.
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lol
