Affordable Health Insurance Impeded By Decade-Long Profits
The health care reform now goes to the Senate and considerations over costs of legislation now increase. Supporters of health reform are stating that affordable health insurance is within reach if spending is managed.
They have a point there since a lot of health care companies which are listed on the Standard and Poor’s 500 have tripled their profits on average in the last 12 years.
There were substantial losses in most economic areas during a 10-year period. Health care costs have, however, steadily increased since 2000 because of the need of having to visit a doctor or hospital every time people get sick or injured.
These increased costs have really made health care insurance much less cost-effective for a lot of folks.
The expensive health plans have increased the profits of the health insurance companies. Figures show that the six health insurance companies which are included in the S&P 500 have made over $10 billion profit.
These massive profits definitely make health insurance more expensive. But insurance companies actually are the least profitable sectors in the healthcare industry. The profits they have right now are below what’s expected because the sales of health insurance have increased at the same time as the profits have.
If the insurers aren’t mainly responsible for the shortage of affordable health insurance in the U.S., who is? Medical suppliers and medical device makers saw the most improvement over the past decade. The former saw their profits grow by 17% since 2000, and the last mentioned had margins of 15%.
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 caused the increase in insurance prices.
What can be done about this? Direct price controls are extremely unlikely, but regulations enacted as part of a healthcare reform bill could nudge the health care industry towards lowering 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.