Health Insurance Profits Soar, Dem Calls For Rebates

WASHINGTON -- Health insurance profits are skyrocketing in 2010 compared to last year's returns and the outgoing chairman of the House subcommittee that oversees the companies is calling on them to return the profits to consumers in the form of premium reductions.

"Your ten firms alone have reported over $9.3 billion in profits for the first three quarters of 2010," writes Rep. Pete Stark (D-Calif.), chairman of the Ways and Means health subcommittee -- and, for a day, chairman of the full committee. "On average, your profits have gone up 41 percent from last year."

Robert Zirkelbach, a spokesman for the leading health insurance trade lobby, America's Health Insurance Plans, said that Democrats shouldn't focus on the companies' profits, but rather the overall cost of health care.

"The data are clear that underlying medical costs are driving up the cost of health care coverage. For every dollar spent on health care in America, less than one penny goes towards health plan profits, and it's time Washington addressed the other 99 cents," he told HuffPost. He added that health insurance profits are lower than returns in other health care sectors.

In January, Stark will lose control of the subcommittee as a result of last Tuesday's election.

The letter, sent on Wednesday, is addressed to the heads of UnitedHealthcare, WellPoint, Aetna, Human, Coventry, AmeriGroup, HealthSpring, HealthNet, Centene and Molina.

Comments

[LynnW49]

04:06 PM on 11/14/2010

Blue Cross/Blue Shield administers our state program enacted to offer an interim (pre-2014) plan under HCR legislation for those who can't get regular insurance (pre-existing conditions). The rates just went up 20%, even though the plan has only been in existence for two months. With a $2500 deductible and annual increases at this rate, by 2014 I will have to spend over $16,000 before I get a penny in coverage.

Without meaningful caps on rate increases, there is no health care reform. Without restoring reasonable rates, those of us who got in under the pre-2014 plan will not be able to afford insurance. It is not even affordable now. And BC/BS got $16,000,000 to set up this program, with only 400 people in the state allowed to get in it. Where is that money going? I want a stinkin' rebate, too. And I fully expect that I will never ever get one.

[Margo Arrowsmith]

09:11 PM on 11/11/2010

How about at the end of the year, they return to the policy holders, after a nice profit, the money that is left over.

Of course, clever book keeping will fix that.

[HarlowMarlowe]

08:36 PM on 11/11/2010

Subject: Health Care Debacle: A Rather Obvious Solution...

Health Care Debacle: A Rather Obvious Solution...

I propose a simple and straightforward bit of legislation to be given to the citizens as a REFERENDUM vote:

Retract absolutely, entirely and completely, every scrap of any health care benefits that government workers get on OUR, the TAXPAYERS, BACKS. Everyone, every last one of them, is to be included; from the lowest civil servants up to and through the entire Congress, i.e. the House and Senate for those of you who know NOTHING; each and every department--up to and including, of course--the Presidency. Obama sure as hell won't argue.

So now they would all have to do just as WE DO!!!!!!! (That is, to buy flagrantly inflated, filthy, anti-American, greedy-to-the-point-of-utter-disgust-and-appalling-embarrassment big business profits, ghastly and obscene corporate profits, "privately-owned" insane asylums and factories around the world and, again, insanely unregulated for-nothing-but-profit...PROFITEERS.

Wouldn't that level the playing field?

Cheers,

[witz]

06:07 PM on 11/11/2010

I'm willing to bet that Mr Zirkelback's "less than one penny" spent on health care goes to profits is more than a little distorted. First of all I can't even shop for healthcare. Here in California I get one choice. Second, he's a freakin lobbyist. It's like that movie, "Thank you for smoking."

And they say more regulation is bad . . .

[racetoinfinity]

05:10 PM on 11/11/2010

A Republican is coming in to chair the committee. There go the calls to the ins. cos. to reduce their premiums. The companies are using the usual lies to deflect their record profits over to health care costs, not their gouging. Did the new reform do ANYTHING to control premium costs? I don't think so. That's what made it so weak; a public option would've controlled premium costs. Asking them to lower premiums is like asking Lloyd Blankfeld to return a few tens of millions from his most recent bonuses. It'll never happen.

[Luminator]

04:55 PM on 11/11/2010

Clip from Frontline: Sick Around the World

http://www.youtube.com/watch?v=Uziy_xAkwSk

[Rudabekia]

03:58 PM on 11/11/2010

The US has become more tragic irony after another. Here's the proof:

Nearly 59 million lack health insurance: CDC

http://www.reuters.com/article/idUSTRE6A905U20101110

The corporate media (if they had any ballz) should divide the news into three categories: the good, the bad and the ugly. Of course, there wouldn't be anything in the good category but the bad and the ugly would be filled to the brim.

[time2impeach]

12:56 PM on 11/11/2010

The only people who should make ANY money off the health or illness of others are Health Care Professionals.

Increasing profit by limiting health care is immoral and should be criminal. Call me socialist, communist, unAmerican, whatever -- I'll call you greedy.

Bottom Line: Eliminate the profit motive, solve the insurance problem.

[GandenT]

01:22 PM on 11/11/2010

Agreed

[racetoinfinity]

05:17 PM on 11/11/2010

As we evolve now, health care should be considered a human right, added to the rights of man. That includes prevention and a clean environment as free of unhealthy pollutants as possible.

[ThatsTheTheWayItIs]

11:15 AM on 11/11/2010

Yes, "health insurance profits are lower than returns in other health care sectors". Health insurance is like large retail, profits come from "volume, volume, volume". Supermarkets profit margins are around 1%, but so much money goes through them they don't need a high profit margin.

Some numbers: US annual GDP is $15T, or 15,000 billion.
17% of that is spent on health care, that's 2,550 billion. 1% of that is $26B a year profit.

But note: that's just profit, it doesn't count the overhead added, to pay all those clerks who try to deny everyone coverage. Those people on insurer "death panels" don't work for free.

[time2impeach]

12:58 PM on 11/11/2010

F&F -- please forward to Sarah "Death Panel" Palin.

[blueken]

10:28 AM on 11/11/2010

For those of you who want the "freedom" to not buy health insurance I have this to say. When you wrap your car around a tree and end up in the hospital with a broken arm, three broken ribs and a bleeding kidney you will recieve treatment. Who do you think pays for that? Are you willing to die for your freedom? Health care should be the many who are well, pay for the few that are sick. Our hospitals by law can't refuse to treat people, so those people should be contributing to the system. There are still over 30 million un-insured. If we got an average of $10 a week each that is $3000 million dollars a week into the system.

[ThatsTheTheWayItIs]

11:23 AM on 11/11/2010

Actually, my auto insurer pays all my medical bills. Yours does too if you have "comprehensive".

The uninsured use emergency rooms less, and overall cost the system less than do the insured. You have been listening to insurance industry misinformation. We don't have "health insurance" in this country, you can't buy it. We have "health care plans", where everybody pays the same then all services and drugs are free.

I am uninsured in MA because I can't buy insurance, I have to subsidize others, pay for useless services and drugs. The cheapest plan you can buy is $5,000 a year, has a $2,000 deductible and mandatory prescription drug coverage. A $5,000 plan with a $2,000 deductible is not insurance, and drug coverage is definitely not. No one gets bankrupted by drug costs.

MA didn't require drug coverage originally, then added it no doubt due to drug industry pressure. That added $1000 a year and I dropped my coverage.

From all I've heard, the Fed plan will be the same: health care plans only, insurance not allowed. They argue that "preventative medicine" saves money, but it does not. And in any case, the actuaries know whether it does or not, they will price it into the policies, and I will be paying if it really does cost more, nobody else, so I should be able to buy insurance and not subsidize our bloated medical industry. But I can't, not and fulfill the so-called "mandate" (really a tax on the uninsured, that's all it is).

[lovemycivicduty]

10:27 AM on 11/11/2010

Companies continue to get larger, more global and dominant, and their profits continue to balloon through the toughest economic/financial times the citizens of this country (and now w/global economy, the world) have seen in over 75 years....but we will not cut the taxes on the rich to equal out the income gap? We are in dire need of a progressive tax to turn this country around.
And a rebuttal to the argument that they need profits now to grow their business and create jobs and new markets, etc. We aren't seeing the jobs being created. They are giving larger bonuses and spending more and more money on lobbying to continue to grow the income gap.

[blaising]

10:24 AM on 11/11/2010

As soon as we (the government) step in to regulate these guys, the profits go up. What's wrong with this picture?!?!

[Finesse17a]

10:23 AM on 11/11/2010

What is the need for insurance companies having an anti-trust exemption? The original reason is pretty bogus. Why do they still have it in 2010? In the interests of a free market, why should insurance cartels be allowed to choose patient, price, service, doctor, hospital, and your future? Is this the choice that people want? Insurance cartels hide their money by saying that %31 of their premium dollars are spent on 'administrative costs'. Instead of saying that they make more in profits they just say that it costs more for administration.

[anotheRedherring]

10:14 AM on 11/11/2010

the nation just needs a collective pool that those who are willing can buy into.
insurance companies are a collective bargain AGAINST the people. we need to level our odds.

[Sabrina1]

10:10 AM on 11/11/2010

We need health care; we don't need insurance companies.
Delivering health care for profit is a conflict of interest.