This is an industry with rare consumer praise, even though consumers may want or need its services.
Although there are far more than 1000 competing firms in this market, prices do not go down across the industry, suggesting competitive pressures have failed.
It’s a mature product, been around for most of our life times, yet the product has not earned more loyalty from consumers.
Consumers die every day because of the failure of this industry to safely and effectively meet consumers’ needs.
It’s been propped up by government through a number of different methods including market guarantees and supportive legislation.
What industry is this?
It’s not the American auto industry and its supply chain, trying to reduce capacity and costs while taking government financing and benefitting from Cash for Clunkers.
It’s not the banking industry and the fat cat banksters wallowing in their TARP-funded bonuses.
Give up guessing?
It’s health insurance.
If health insurers don’t catch a clue about their failed business model, we should do what we’ve done to other failed enterprises. It’s a step not substantively different from preventing a massive loss of jobs and manufacturing capacity by stepping in on General Motors and Chrysler, or trying to prevent a market meltdown by salvaging what’s left of the banks who are needed to fund business and provide services to citizens.
I say we rethink the public option and tell the industry it’s time to quit screwing around and face up to the truth: their business model is bankrupting us, it’s not delivering what we need, it’s literally a threat to our health as a nation.
And then we tell them to start negotiating in good faith to deliver a public option or we’re going to seize them because they have been cooking their numbers for years by dropping insureds at will off their rolls (and if you really think about it, you can think of numerous other ways they cook their books, like systematically denying claims unless forced to pay). At the end of the day, there may be a new industry with a smaller number of players who can provide coverage for all by way of economies of scale and by eliminating so many middlemen who don’t add value while obstructing competition.
If it’s good enough for one of our largest manufacturing industries and good enough for our banking industry, why not use the same approach with the health insurance industry?
Why place any more trust in their intentions? They’ve already shown their hand.
Simply seize ‘em.
[Graphic: Sign in MA restaurant window by Spatch via Flickr. Cross-posted to Rayne Today.]
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And yes, I know, the Latin may not be correct but I think you get the point.
“Carpe inceptum quam minimum credulum postero” makes sense, where “inceptum” means “undertaking”. Also “Carpe incepto quam minimum credula postero” (where “incepto” means “in the beginning”)
The irony is that we would be seizing these companies for making too much money.
I was at the drug store yesterday, and an elderly gentleman was filling a prescription – he was told it was $125. He protested that last time he filled it, it cost $25. The pharmacist said his insurance no longer covered that prescription. The gentleman looked whipped.
And providing too little and poor service in return.
I’m imagining Cleese browbeating Chapman over declensions of verbs. Or Peter Cook wryly saying, “I never have the Latin, you see?” What I’m I talking about, most Americans are barely lingual — Ray Romano
It’s a sad sad situation we’re in, to be sure.
This diary is an excellent reframing of the whole issue.
We’ve already taken over one insurance giant, AIG, because it was “too big to fail.” Well, the health insurers have “failed.” They’ve failed to mitigate cover healthcare costs. They’ve failed to keep healthcare costs down. They’ve failed to mitigate risk in the sense that nobody knows if the insurers will cover their bills. And so on.
So, let’s simply seize them as if they were failed banks.
Folks,
Why seize them and have a big argument over socialism vs. capitalism and nationalization when it’s not necessary. Why not just have Medicare for All and take away most of their business?
A great business model
1. Pay CEOs up to $100,000 per hour, other officers slightly less – this is an expense item which can be written off.
2. Hire lobbyists – this is also an expense which can be written off
3. Hire clandestine organizations to run advertising and other operations another expense.
4. Make political contributions another expense
5. Hire lawyers and staff to deny claims or coverage. this is also an expense which can be written off.
6. collect premiums (income) subtract above
7. Pay unavoidable claims also an expense
8. Pay taxes and distribute remainder to stock holders.
Given that Obama self-negotiated away single-payer, the proposal to sieze the insurers expands the Overton window of the healthcare discussion, which just might lead to a viable public option.
Oh, you learn quickly, grasshopper!
We should definitely move to the left every single time they try to drag us to the right. Perhaps not all of us, but definitely some of our shit-stirrers should do so.
I’m glad to be the shit-stirrer in this case. We the people regularly seize entities which fail the social contract to which they are party — like the restaurant in the graphic above, which failed to pay taxes while using our public commons (water and sewer, sidewalks, roads, regulatory system, so on). We seize public and private entities alike for their failures.
So why not seize health insurers? We can’t make it any easier for them to be both profitable AND meet the needs of the people, and they insist on doing only one of these things at a time. foothillsmike at (9) itemizes a list of expenses which could be eliminated, the funding for which could provide basic preventative and maintenance health care in simple clinic settings — but no, it’s all frittered away and profit remains king.
They cannot operate using basic business ethics (i.e., create long-term shareholder value with reasonable decency and distributive justice). They have become frauds.
Just seize them and start over, like the auto makers.
that’s the ticket.