Wednesday, October 28, 2009

The Truth About Health Insurance Industry's "Obscene Profits"

An Associated Press ""Fact Check" piece points out another of the Obama administration's Big Lies. Rather than try to form a winning argument based on facts and logic, Leftists like President Barry Vladimir Hussein Soetero Obama attempt to paint their opponents as evil. The target in the health care debate has been the insurance companies who are said to be making "record profits." Oh really??

Quick quiz: What do these enterprises have in common? Farm and construction
machinery, Tupperware, the railroads, Hershey sweets, Yum food brands and Yahoo?
Answer: They're all more profitable than the health insurance industry.

Candy bars and plastic ware to keep your leftovers fresh must be REALLY evil compared to the rapacious insurance companies.

In the health care debate, Democrats and their allies have gone after insurance companies as rapacious profiteers making "immoral" and "obscene" returns while "the bodies pile up."

Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent, give or take a point or two. That's anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.

Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year, as investors were warned of a stagnant if not shrinking market for private plans.

Two percent? Yes, that is obscene, but not in the way Statists who seek to control everyone's health care frame the charge. It is an obscenity to the corporations' stockholders. Even at the typical six percent, the health insurance industry is not breaking the bank.


_"I'm very pleased that (Democratic leaders) will be talking, too, about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years." House Speaker Nancy Pelosi, D-Calif., who also welcomed the attention being drawn to insurers' "obscene profits."

_"Keeping the status quo may be what the insurance industry wants their premiums have more than doubled in the last decade and their profits have skyrocketed." Maryland Rep. Chris Van Hollen, member of the Democratic leadership.

_"Health insurance companies are willing to let the bodies pile up as long as their profits are safe." A ad.

Health insurers posted a 2.2 percent profit margin last year, placing them 35th on the Fortune 500 list of top industries. As is typical, other health sectors did much better — drugs and medical products and services were both in the top 10.

The railroads brought in a 12.6 percent profit margin. Leading the list: network and other communications equipment, at 20.4 percent.

HealthSpring, the best performer in the health insurance industry, posted 5.4 percent. That's a less profitable margin than was achieved by the makers of Tupperware, Clorox bleach and Molson and Coors beers.

The star among the health insurance companies did, however, nose out Jack in the Box restaurants, which only achieved a 4 percent margin.

Well, there you go. When will the Leftist-Statist-Democrats begin bashing Big Beer, Big Detergent, and Big Plastic? The answer is, as soon as those industries stand between these vile demogogues and some aspect of American life they want to control. The insurers' profits are far from obscene. However, the behavior of Obama, Pelosi, Reid and the other would-be rulers of your life is beyond obscene. It is criminal.

Health insurance companies operate within the arena of growing health care costs, many of which can be laid directly at the feet of government. They are impacted by the lack of competition. They are impacted by government managed markets. They are impacted by the lack of control over ambulance chasers. They are impacted by the inability to offer different levels of coverage.

President Obama claimed he wanted a robust, comprehensive debate on health care. But, to paraphrase Joe Wilson, "he lied!" No matter how much the numbers and the realities refute the claims made by Obama and the leadership of the Kremlin on the Potomac they continue to attack the messenger. Everyone is a tool of Big Insurance or Big Pharma or simply hypnotized by Fox News. The truth is, Democrats are losing the health care debate in the arena of honest debate. The American people are not as ignorant as Democrats like to think. As many legislators found out over the summer, their constituents understood the issues better than the professional politicians. Maybe it is time they begin to heed their betters out here in Real America.

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