Aetna Proves That Single Payer Is The Only Way To Go
It's been over two years since the bulk of Obamacare went into effect, and American health insurance companies are making a great case for why it's time to adopt a single payer system and take the profit motive out of how health care is paid for once and for all.
On Monday, Aetna, America's third largest insurance company, announced that it will withdraw from Obamacare exchanges in 11 states and it will only offer insurance through the state-level Obamacare marketplaces in four states in 2017.
Obamacare has, overall, been a huge success, especially among the less visible and more marginalized populations in America.
Economist David Cutler told the New York Times back in April that "The law has clearly reduced broad measures of inequality. These are people who blend into the background of the economy. They are cleaning your hotel room, making your sandwich. The law has helped this population enormously."
In February, the administration estimated that roughly 20 million more people have insurance now that Obamacare has gone into effect, and marginalized groups in general benefited the most.
According to that New York Times analysis from April: "Part-time workers gained insurance at a higher rate than full-time workers, and people with high school degrees gained it at double the rate of college graduates. Adults living in households headed by relatives, such as siblings or cousins, [which is] often a marker of economic distress, gained insurance at double the rate of traditional households."
And having health insurance and access to affordable healthcare leads to big benefits for communities: the New York Times reported that one federally funded health clinic in South Los Angeles has enrolled 18,000 new patients under the law, nearly all of them from minority backgrounds, and the clinic reported a 44 percent increase in cervical cancer screenings and a 25 percent increase in tobacco cessation therapy, which means more lives saved and healthier community outcomes.
But, Aetna's announcement on Monday is proof that the law is still fundamentally flawed.
And Aetna is by no means alone.
In April, UnitedHealth Group, the largest health insurance company in America, announced in April that it will be withdrawing from the ACA insurance exchanges in most of the 34 states where it currently operates, saying that it's expecting to lose $650 million dollars in 2016.
The Kaiser Family Foundation points out that if United dropped out of all 34 states, 1.1 million people would have just one option for an insurer, creating a for-profit monopoly for those people.
And then there's Humana, which announced in July that the company will offer exchange plans in "no more" than 11 states next year in 2017.
Humana's announcement coincidentally came on the exact same day that the Department of Justice filed a lawsuit to block Humana's proposed merger with Aetna.
Some of the shortcomings with Obamacare can be traced to the fact that so many red states have refused federal funds to expand Medicaid.
But the truth is, we're never going to be able to affordably cover every American until we address the major problem with our health care system: The profit motive.
Journalist and Author T.R. Reid pointed out in his 2008 documentary Sick around the World that the United States is the only industrialized nation in the world that allows for-profit corporations to offer basic, primary care health insurance.
The key difference between us and the rest of the developed world is that health care is considered a legal and political right in every other industrialized country, and here it's only considered a privilege.
And when people pay for health insurance provided by a for-profit company, they aren't just paying for insurance, they're paying for all of the administrative costs of the company, including executive salaries and CEO bonuses.
According to filings with the Securities and Exchange Commission, Aetna's Chairman and CEO Mark Bertolini took home $27.9 million in compensation last year, about $24.8 million of which was value gained on stock options.
In 2014, UnitedHealthcare CEO Stephen Hemsley took home over $66 million dollars, including $45.5 million in exercised stock options.
Those salaries and stock options make up just a portion of the 12 percent to 14 percent administrative overheads that are typical for for-profit health insurance companies.
So while the executives get bonuses, consumers like you and I get stiffed with paying for it in the form of inflated insurance rates!.
In contrast, in 2015 the administrative overhead amounts for Medicare were only about 2 percent of the program's operating costs and nobody working for Medicare became a multimillionaire.
If we want universal coverage at the federal level, we need to take the profit-motive out of healthcare with a federal single-payer program like the Medicare-For-All programs proposed by Congressman John Conyers and Senator Bernie Sanders.
But this isn't something that we have to wait for Congress to take action on - citizens at the state level can take the lead.
Right now in Colorado, there is a very popular proposed amendment that would replace the state's problematic Obamacare insurance exchange with a universal healthcare program called "ColoradoCare."
Very simply, the program would pair private providers with state funds from combined sources to extend healthcare coverage to every man, woman, and child in Colorado.
Citizens in Colorado are leading the way, but citizens in other states can, and should, organize and push for efficient statewide universal healthcare systems to replace the inefficient and costly for-profit insurers that cruelly put profit over people.
Canada at one time was against single payer health care.
One "leftist" province barely managed to vote in a single payer system,
It worked so well that another province voted it in.
And now all of Canada has the program.
Seems a good model to bring single payer to the US.
IMHO the S&P 500 or mega market cap publicly held stock companies that provide healthcare insurance do not want the ACA to succeed because their business model is flawed in an investor environment that has as its sole criteria the ever increasing demand from Wall Street to meet analyst expecations regarding margin percentages, net income as percentage of sales, debt to equity, EBITDA and other wealth creating investment metrics.
Yes, the non-profit or the co-ops have also failed to be economically viable but their success IMO was doubtful from the beginning because of their lack of depth and scope. In short, for a co-op health insurance provider to be successful what is needed is economies of scale across the U.S. or at least regionally when providing health insurance. The subscriber pool must be mult-diverse and not in just Kentucky, or Ohio, or Nevada, or California, or any individual state.
The ACA at a minimum needs to be reformed to permit cross-state insurance carriers at a regional level or preferably a national level to work. The profit motive also needs to removed and a Swiss style health insurance regulatory environment needs to be implemented at a minimum too.
I do agree with Thom that a Medicare for all would be the best solution but at this juncture in our poltical system, I doubt it would pass. HRC, for example, only wants to extend Medicare to those between 55 and 64 thanks to Senator Sanders pushing her further left so no Republican wll be for HRC's enhanced Medicare proposal. I doubt if any GOP member of Congress would endorse mine either but Blue Dog Democrats probably would if provided with enough leadership from the executive and legislative branches as well as taking back the House and the Senate in 2016.
Under these circumstances, I am voting for Mickey or Minnie Mouse as long as they have a D next to their name.
The Canadian province was Saskatchewan . Americans should learn from them and get rid of a national program and do what Canada does. Each province has its own individual health care. It pushes them all to have a better system. Like the US, Canada has very different regions that require different needs. One size doesn't fit all. But for the record our system is horrible. If you don't mind waiting 14 to 16 hours in emergency. Or going without a family doctor because they are all full because their isn't enough of them. Let your government run it. But then again if you are happy with your education system you will love it. It will be run the same. Extremely top heavy. Not enough nurses and doctors but plenty of admination.
Being the very last industrialized country to still have for profit health insurance points out how far away we are from a government that "derives its just powers from the consent of the governed." Instead we have a government that derives its unjust power almost entirely from the consent of elite/fascists.
A Teapublic is obviously not what our founders intended.
Thank You Kend for your honest apprisal of the health care program in Canada. Most people south of the 49th parallel don't realize each provience has its' own health care program. In effect, each provience is like a separate HMO here in the states. I lived in Canada for 6 years, I lived primarly in Ontario and did not qualify for OHIP (for those in the USA, that's the Ontario health insurance program). I had many friends in the north who went without a family doctor, and if they wanted medical care were required to visit a clinic. The clinic was free, but you may be seen by a PA, not a MD. Chances are you would never see the same person twice.
Single Payer will never ever happen in the USA. The next generation will see to that. Most of these washed up lefties are on death's door step. The next generation is not interested in pursuing those washed up ideas. I have a lot of faith in the younger generation. They will straighten out the mess created by the Baby Boomers.
Health insurance is a misnomer. Underwriting is prohibited by the Affordable Care Act and without underwriting it is not insurance. Insurance has risk-based individual premiums. Health plans are more accurately referred to as entitlements or social welfare programs. Further, why would we want insurance? Insurance is always for uncontrollable events. Do we want to promote the idea that we have no control over our own health? Insurance is always for a loss. Health is goal oriented. Insurance presumes retrospective payment. Why not have prospective payment to join a health delivery system and skip all payers, including the single payer idea? That is what we do with education. The individual annual cost/subsidy could be calculated by the current health plan companies taking into account history, health risk, moral hazard in managing health, individual assets and income, etc. Aetna is well aware that not only the ACA law is flawed, but the idea of health insurance is flawed. The CEO anticipates moving out of medical insurance.
Americans should also know that Canadians do pay a health care premium in most areas of Canada as well. it isn't free. This only covers basic care. Most Canadians or the companies they work for also buy additional insurance for eye care, dental, meds, ambulance etc. that are not covered by the province, this costs around $200 a month per person. We also pay much more personal taxes up her for our socialist system to operate. What our system and the ACA should be called is "tax the people who work more and reduce the level of care for them so that everyone, whether they work or not, can have the same level health care", care. That is the reality of a single payer system. Be careful what you wish for it might come true.
This is not on subject, but I like being able to voice my question without facebook - I was a "member" for a short time then had to work for many weeks to GET OUT -- not a fan. Anyway - here's my question - someone pointed out to me that the term ISIS - and other related terms - DID NOT exist prior to GW telling us about those "weapons of mass destruction" that lead us on the path to Iraq. Is this valid? My feelings about what that administration - many included here - did and GOT AWAY WITH - makes me very angry! They should all be in prison for MASS MURDER! Sure like how so much blame gets dumped on President Obama!
You're missing the big picture: The insurers can't make money because they can't survive competing on price, which is what the exchanges are all about. The lower the price, the smaller the profit, the more they complain, the quicker they exit.
They need a fragmented market place to confuse and charge as much as they want. Crossing state lines just makes it even worse for consumers to negotiate, buying plans they can afford bur won't cover much of anything.
I am all for single payer. As long as the single layer is George Soros. A true single layer system in this country would over charge 40 % of its citizens. The ACA, if the Cadillac Tax is ever implemented as written, will harm more Americans than the 20 Million it added on the rolls of the insured. Even Canada's system has significant supplement private policies to upgrade basic insurance to make it work for those who want specialists and any type of convenience.
Thom mentioned on air this morning how the CEO of AETNA personally earned $30 million last year - the equivalent of $15,000 per hour - complaining that the stock-motivated Wall Street company apparently cannot make it's investor's goals and thereby wants to withdraw from Obama care.
In the true spirit of conservatism, Trump made it clear that he will "get rid of Obama care and replace it with something 'great.'"
My Obama care plan provides an annual deductible is $6500 per year. That means I pay the first $6500 of care. I just underwent outpatient hernia repair surgery for a problem that I have had for over five years. They said it will cost $5997.23. That is more than I paid him my federal and state taxes last year.
Some time ago I severely twisted my ankle and was uncertain whether it may have broke it. My so-called nonprofit local provider billed me at $600 per hour for x-rays and a 15 minute doctor visit.
Or medical care is a reflection of the diminished middle-class - either I have fallen into poverty or our medical system has become the military-industrial complex of health care.
No one is more secure than a pink slip from being terminated from their job away from receiving medical care.
Rich in Folsom, CA