Obstruction Of Reasonably Priced Health Insurance By Decade-Long Profits
While the health care reform fight goes to the Senate, considerations over the cost of legislation are very important. Supporters of reform claim that affordable health insurance is within reach if misuse in the health care industry is decreased.
They may have a point; a recent study indicates that health care companies which are in the Standard & Poor’s 500 have, typically, tripled their profits in the last decade.
Over a 10-year period there has been a significant loss for most economic industries. But the health industry continues to make more and more money which really does make sense because people are still going to be becoming sick and having to go to hospitals and clinics to be cured or healed.
The rising health care costs over this time frame have really made it difficult for people to continue to pay for coverage.
Health insurance companies are typically the ones getting profit from the expensive healthcare plans.
So, there’s no question that they have gained a lot from this over the last decade. According to statistics, the six health insurance companies in the S&P 500 have made over $10 billion.
It would seem that these massive profits are standing in the way of affordable health insurance. However, insurance companies are actually one of the least profitable sectors of the healthcare industry.
Their profits are less than expected, because sales of health insurance increased almost as much as profits.
So, if the insurance companies are not the primary reason of the shortage of inexpensive health insurance, then who is? Over the past decade, the medical device makers and medical suppliers saw the most improvement.
They have raised their profits by 17% and 15% respectively.Pharmaceutical firms have also doubled their profits at the same time increased their margins to as high as 25%. These industries mentioned are the ones responsible for advances in medicine. However, they have also brought about the increase in insurance costs.
What can be done about this? Direct price controls are extremely improbable, but regulations enacted as part of a healthcare reform bill could nudge the health care industry towards reducing its costs.
Affordable health insurance will be more plentiful if health insurers don’t need to pay exorbitant rates for the majority of their supplies and services.