Private Insurance Rates, Measure Reality

A private insurance company has to charge rates that allow it to survive and show a profit to shareholders. Right now profitability is around 6% (one earthquake could turn that negative). As businessman starting up a venture, you want to see at least 12-20% profit. Otherwise put it in the bank and let the bank take the risks. Health insurance sucks as a business venture. A home builder can make 200% so why sell insurance?

Not only do insurers face very low return on equity, any State or Federal legislation could put them out of business. When Insurance companies raise rates, they are showing you the reality of health care costs. Obama is blaming the insurance companies for making health care unaffordable. Is home owner's insurance unaffordable? How about automobile insurance? These insurance carriers have scores of accountants using actuary tables to figure their bottom line daily. In order to survive, they have to charge accordingly.

What do you get with a government health care plan? As with any part of government program, there is no financial responsibility. Our government can’t even balance their own budget. The European health care plans are smoke and mirrors. They don’t charge their citizens the true cost of the insurance, they tack it on to their national debt. Plus there is no competition and a surgeon with a lot of experience can’t charge more than one out of med school.

In this country, a lot of our doctors, new to open heart surgery, get to practice on Medicare patients. Then they move on to cash paying customers. Many doctors won’t take Medicare patients; the government reimbursement rates are too low. Of course a doctor that knows how to play the game could abuse a Medicare patient by sending them  in for 10 different tests and make a pretty good return. This type of doctor, will send a cab to your door to pick you up.

Unlimited health care is unaffordable with any private insurer. It is not any more affordable as a government run enterprise. In Great Britain, the waiting time for surgery is now down to ONLY 18 weeks. It’s kind of like being told you can use the bathroom once every three days; can you wait that long?

The reason a lot of people like Obamacare, is that they know the government has no way to figure the actual costs. The plan will trim a half trillion dollars of benefits to Medicare that the government has been picking up and add it to the premiums to be paid by the wage earners health plan.  Isn't that slick!

Most people could probably afford health care if it was a priority. A priority is a new shiny car, two packs of cigarettes a day and a twelve pack of beer (this would vary, pick your own items). The kids get cereal and a bag of candy. The government figures it this way, everyone will have to pay for insurance or be fined. That way you can’t wait until you are sick to subscribe. So before you get your paycheck, the government is going to take out one pack of cigarettes and a 6 pack of beer every day and two car payments per year. What's  Joe Six-pack's reaction?  The kids get to eat their cereal with water and he cuts back on their candy, clothing, school supplies and they walk to school. Plus he drops his auto insurance. The good news is that if you work under the table, like selling drugs or hooking, you are considered  poor, and qualify for free health care.

I listened to Obama’s speech today and couldn’t believe the rhetoric. Here is an excerpt from it:

At the heart of this debate is the question of whether we’re going to accept a system that works better for the insurance companies than it does for the American people -- (applause) -- because if this vote fails, the insurance industry will continue to run amok. They will continue to deny people coverage. They will continue to deny people care. They will continue to jack up premiums 40 or 50 or 60 percent as they have in the last few weeks without any accountability whatsoever. They know this. And that’s why their lobbyists are stalking the halls of Congress as we speak, and pouring millions of dollars into negative ads. And that’s why they are doing everything they can to kill this bill.

I try to avoid political comments and have been neutral on Obama up to this point. But this President is a Beet Head.  You don’t shoot the messenger. You can bet your bottom dollar that whatever the insurance company deems reasonable for premiums, keeps them in business and no government can do it for less.  


I think this President has an  ego to feed; he wants to write some history. The trouble is, if this passes, we might have a Constitutional convention to rewrite our constitution. There are enough states riled up  about this to make it happen, and that might not be a good thing. The government  printed a ton of money and gave it to their cronies on Wall Street (900 billion dollars). Now Obama complains that it is un-American to make a profit. But threaten to go broke, and they throw money at you, just ask AIG. On the other hand, let's go get those robber drug companies, Rah, Rah, Rah!

This government health care plan is what I have referred to in the past as the "Disneyland Plan."  You have no problem getting in, but the length of the lines for each ride are a joke. Grab a number and wait.