Private Health Insurance : Going the Way of the Dinosaur


In the map above, the countries with universal health care are in blue. Those trying to get it are in green. Note that the United States proudly takes its place among the third-world countries of Central Asia, Africa, and parts of South America. We should be ashamed.

Private insurance:
Bound for extinction

By Ted McLaughlin / The Rag Blog / March 3, 2010

One of the things the Democrats were elected to do was to fix our badly broken health care system. It looks like they are going to fail to do that. They might wind up passing the anemic and pitiful Senate health care reform plan, but that falls far short of really reforming the health care system. It does little but continue the broken system we currently have with a few modest and mainly cosmetic changes.

One of the worst failures is to leave Americans with no choice except to purchase private health insurance. While this will guarantee huge profits for the large private insurance companies for some more years into the future, it is ultimately doomed to an ignoble failure. We are already beginning to see that these private companies just can’t do the job indefinitely. Consider the current situation with Wellpoint (whose subsidiary is Anthem Blue Cross of California).

Anthem Blue Cross is the company that recently announced it is raising most of its premiums by a whopping 39%. The Wellpoint CEO recently went before Congress and said they have to raise the premiums that much because, “One, people are getting older. Two, people are becoming unemployed, and if they’re healthy they’re dropping out of the insurance pool. Three, the cost of diagnostic testing is soaring.” She asked for government help.

But frankly, there is little the government can do for these problems (and the terrible Senate bill does nothing to solve them). The fact is that the jobless situation is going to be around for quite a while, because it was not only caused by the recession, but by outsourcing jobs which continues unabated. And of course, people are going to keep getting older and medical costs and testing will continue to get more expensive.

That means the private insurance companies will continue to raise the price of their premiums and cut the number of things those premiums will cover. I can remember that years ago a private insurance policy would cover virtually all medical costs. These days a person is lucky if their private insurance covers a significant part of the costs (and there are many medical procedures not covered at all because private insurance considers them too expensive).

With each rise in premium cost, more people are squeezed off the insurance rolls — thus making it necessary for the companies to again raise premium costs and further cut coverage. Soon we will be left with expensive private insurance policies that cover virtually nothing.

I believe the CEOs of the insurance companies know they can’t keep their spinning plates in the air indefinitely. They know that at sometime down the road their policies will become so expensive and cover so little that the health care system will implode. They just don’t care as long as they can continue getting windfall profits for as long as they can stretch this farce out.

Consider the following: Anthem Blue Cross brags that a woman can still get a private insurance policy for only $156 a month. That may sound good to some until they consider this policy has a $1500 deductible, and then only pays for 30% of most medical procedures and tests, makes the woman pay up to $500 a day for a hospital room, and doesn’t cover pregnancy or delivery costs at all. How good a policy is that?

Whether the Republicans and the private insurance companies want to admit it or not, the days are numbered for private insurance health care policies. In an effort to continue their profits, they will keep raising premiums and cutting coverage until they price themselves out of the marketplace. Then they will be replaced by a single-payer government health care system like other developed nations have.

It is not a question of whether we want it to happen — it has to happen. There is no other option. The Congress could have saved a lot of time, money, and heartache by passing a public insurance plan this year, but they’re going to blow it. So we’re going to get more years of insurance companies raising rates and denying coverage, of many more Americans going bankrupt, and millions more Americans dying because their insurance (if they have any) won’t pay for their treatment.

Teddy Roosevelt failed, Bill Clinton failed, and now Barack Obama has failed, but single-payer public insurance will come. If for no other reason, the economics of the situation demands it. The right-wingers and blue dogs need to get used to the idea. There is literally no alternative.

[Rag Blog contributor Ted McLaughlin also posts at jobsanger.]

The Rag Blog

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5 Responses to Private Health Insurance : Going the Way of the Dinosaur

  1. Anonymous says:

    Ted Mc writes:
    “but single-payer public insurance will come. If for no other reason, the economics of the situation demands it.”

    Maybe so.. but the vast majority of us “Boomers” will be so much fish food by then.. Of course, we know from the movies that the world as we know it will end in 2012.. The insurance companies will blame the Boomers for dying early, screwing up their actuarial tables and ask for a government bail-out.. ALL the Republicans will vote “Yea” for the first time since 2006!

  2. Anonymous says:

    OK, lets start at the beginning. The subject at hand is NOT Health Care, rather it is Disease Management. Let’s get our descriptors right so we can think straight!

    In the present system, the motive for profit and the motive to restore people to health are at odds with each other. Guess which one wins! BTW, Big Pharma wants treatments, not cures, because every person cured is a customer lost!!!

    As you may have noticed, the money spent on alternative therapies has risen so dramatically in recent years, that allopathic medical schools have added this topic to their curriculum. Not that they intend to do much about it, though.

    And yes, the cure to cancer has been around for a long time. Just do a web search for Dr. Royal Rife for starters. As well, you may wish to research Dr. Wilhelm Reich and for something more modern, the William Hitt Clinic.

    I only ask that you neither disbelieve nor believe what I have to say, but rather to do your own research and come to your own provisional conclusions.

    Bless You and Good Luck!

  3. Eric says:

    Over and over I hear people arguing about whether public or private insurance institutions should insulate each person from their medical bills, but really the problem is the size of those bills. Medical costs have nothing to do with the quantity of materials consumed or hours of labor performed but rather what a businessman has learned is the maximum an insurance company could possibly be charged. Few mortals have as much money as an insurance company, so they have to rely on insurance. The insurance companies are credited with keeping costs down, but really they just enforce equality amongst the medical extortionists. The more money an insurance company collects, the more money it keeps.

    Furthermore, the system is rigged to cost more. Evidence-based medicine doctrine means that one must use the proven best possible treatment even if it is terribly expensive, of dubious effectiveness, and with awful side effects and risks. The evidence is accepted by the government in exchange for a large sum of money, and lawyers can then enforce the use of the “best possible treatments” through malpractice suits. When medicine was grey, fuzzy, and up to the opinions of physicians, lawyers had little to sink their teeth into. Now doctors will test you for cancer when you come in with a scraped knee just so they can sleep at night.

    The business models used by the medical industry today were pioneered by ransom kidnappers and drug dealers. One answer is government insurance, but in the US, government collects money and hires contractors to waste it. Another answer is to allow doctors to use other than the “proven best possible treatment”, because often there is something that works as well that costs very little. After all, the difficult an complex parts of the healing process are done by the body free of charge.

  4. Anonymous says:

    “The U.S. is a a third world country and should hang it’s head in shame.”

    The U.S, should also hang it’s head in shame for:

    1-taking /squeezing the Natural Resources form other countries, and leaving them poor. Whatever is added to yourselves, is taken away from others.

    Other countries have always known this – but it is confirmed in John Perkin’s “Confessions of an Economic Hitman” – also. on YouTube.

    2-Having the hubris of calling poor countries- with decent, hardworking people, – THIRD WORLD. AFTER the U.S. has taken their goods.

    Or why do YOU think the people in the U.S. have been living over-all, “high off the hog?”

    The most wasteful culture in the entire planet- when something is not working or not wanted (even old folk), by all means, through ’em out!

    Now the shoe in on the other foot. The U.S. now is Third World, and the Chns. are the rising economy.

    But everything is a lesson for the Human Ego – to find out how a condition feels, and a chance to do better. In Fairness, justice, compassion.

    p.s. this applies to the world of Nature – and the lower animals, and our dealings with them.

  5. Anonymous says:

    As long as physicians, vets, dentists are free to set skyhigh charges, patients and insurance companies will get raped. Once upon a time the above were professions whose creed forbid ripping off customers. Now have charges no business can touch. So don’t call them professions or businesses. Just crooks! Exorbitant charges for simple procedures or none at all without any knowledge of the biochemistry of nutrition for real cures not symptom alleviation.

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