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by phil2122 hours ago |
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upvoteby rayiner22 hours ago|
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Trying to understand why healthcare in the U.S. is so expensive is like trying to understand why building subway in New York is so expensive: https://www.nytimes.com/2017/12/28/nyregion/new-york-subway-.... The issues lend themselves to facile explanations ("insurance companies are greedy," "NYC's government is wasteful") but those are driven by ideology not analysis.
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upvoteby autoexec19 hours ago|
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What we can say for certain is that heath insurance companies in the US stuff their pockets with tens of billions in profits each year and that Americans are paying far more while getting less for their money than other developed nations. I don't think those two things are unrelated.
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upvoteby rayiner8 hours ago|
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U.S. healthcare spending is over $5 trillion a year. That’s $5,000 billion. So the “tens of billions in profits” you’re pointing to accounts for very little of what people spend on healthcare.

That’s what I mean when I refer to facile ideological reactions. For many people, “profits” are the problem, and they don’t care that health insurers on average are less profitable than Subway franchises. It’s just the mirror image of people who say the New York MTA is a disaster because the government is running it, and don’t care that governments in other countries manage to run cost-efficient train systems.

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upvoteby gmoot18 hours ago|
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What is the profit margin of a health insurance company? Google suggests 2-4%, with United at about 6%. This does not seem that extravagant.
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upvoteby nradov18 hours ago|
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Something around half of UnitedHealth Group (UHN) profits come from other business units that aren't directly related to UnitedHealthcare insurance plans. They have a huge software business under the Optum brand that would be one of the top 20 largest US tech companies if it was broken out separately.
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upvoteby rayiner8 hours ago|
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That means the insurer part makes even less profit.
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upvoteby chickensong12 hours ago|
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> they are almost all public corporations that are highly regulated so the numbers on profit and expense ratios are easy to get for yourself to prove the point

Big players like United just shuffle money around because they own the entire vertical market. Their insurance arm is regulated so they just move the money to to their service provider arms like Optum which are unregulated with uncapped profits.

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upvoteby nradov22 hours ago|
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Many of the largest health plans are non-profit, not publicly traded corporations. This includes most of the Blue Cross Blue Shield Association licensees as well as some other large payers such as EmblemHealth.
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upvoteby chickensong12 hours ago|
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Blue Shield/Cross is a federation, and Emblem is regional.

The real players are big corps like United and CVS, who control the whole vertical of provider and payer. They own the doctors, the pharmacies, and the insurance.

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