As We Dither, Thousands More Lose Health Insurance
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I was reading a newspaper over lunch recently when one article jumped out at me. It was titled "Health Care Insurer's Profits up 56 Percent."
The article attributed the claim to an organization called Health Care for America Now, "a -coalition of liberal advocacy groups and labor unions." HCAN came up with that -number by looking at the 2009 annual reports of five of the country's largest insurance -companies, WellPoint, UnitedHealth Group, Cigna, Aetna and Humana.
HCAN's claims were dismissed by people within the industry who pointed out that at the end of 2008, the -economy was in the depths of the recession, so the gains for 2009 over 2008 seem more dramatic than they really are. Robert Zirkelback, a Washington-based lobbyist for the industry, called the report "disingenuous."
As all five companies are publicly traded, the numbers are easy enough to check out. It should be noted that the 56 percent increase in revenues touted by HCAN is based upon gross income, not net. The net income numbers, while still impressive, are not as gaudy.
To view their profit growth more objectively, one can compare the -companies' net profits for 2007 (which, it turns out, was also a year of record -profits for the industry) with 2008 and then to 2009. All five companies' bottom lines were down in 2008 vs. 2007.
But comparing 2009 with 2007, four of the five companies' net incomes were up - and by an average of 33 percent. Only Aetna's net income went down over that two-year period, and that was in spite of a 21 percent increase in gross revenues.
Those are pretty healthy returns in what has been a pretty unhealthy -economy. In terms of earnings growth, the insurer's results blow away the likes of GE, Microsoft and Exxon/Mobile. While millions of their customers have been losing their livelihoods, losing their homes and losing their health insurance, the health-insurance companies and their shareholders have been doing just fine.
Now, in the first quarter of 2010, health insurers are busy trying to raise rates across the country - as much as 23 percent in Maine, 20-30 percent in Kansas, 15 percent in Rhode Island and 16 percent in Oregon.
I've seen posts by people in North Carolina who say that their Blue Cross Blue Shield rates are going up by 20 -percent, and most of us have seen or read about the 39 percent increase -proposed by Anthem Blue Cross in California.
While "Tea Parties" conjure up imaginary "death panels" and the specter of socialism, our very real and very broken health-care system continues to grow more costly and adds to the burden of millions Americans, squeezing more of us out each day even as industry profits soar.
There is a misguided sense of -otherness in which some people who are happy with their health insurance are afraid that they might be asked to share the burden of others who have been less fortunate. There is a mentality so -fixated on the possibility of higher tax rates that it's blind to the fact that every dollar spent on ever-expanding health-care costs is, just like tax dollars, a -dollar not spent growing local economies.
It's a dollar not spent at local retailers, restaurants and car dealerships. It's a dollar not spent in ways that create jobs where we live.
There are two health-care reform bills before Congress right now. Neither is perfect. There are no perfect solutions. The Republicans want to start over, but there's nothing in their proposals to -suggest that anything better is in the -offing.
A fatigue has set in on the process as those we elect to serve us instead engage in partisan gamesmanship at the expense of the well-being of their -constituents.
Meanwhile, every day that health-care reform is delayed is a day in which the health insurance companies get richer even as 14,000 more Americans lose their health insurance.
Kevin Smith lives in Aberdeen. Contact him at kevinasmith@gmx.com.
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