The American Healthcare System is facing the hardest year to come.... and many America people that face any long health issues can become a state of financial ruin... hundreds and thousands of patients will be forced to become bankrupt and loose everything they have- all due to the healthcare cover is insufficient to their hospital care.. (read more here [ Ссылка ] )

In fact, faced with the end of their gravy train, insurance companies are making demands for increased compensation for providing coverage. The billions they are already making doesn’t seem to be enough. Almost all the major carriers are threatening to will pull out of the individual markets unless they get a clear commitment from our government to continue funding the ”costs” of providing compliant policies for those individuals who cannot obtain insurance from their job. The “costs” being the government continuing to reimburse the insurance companies for any policy they issue where the expenses incurred exceed the premium paid for that policy. In addition, they want additional money for making these policies available to low income people. For example, in 2015 UnitedHealth Group reported a profit of $11 billion (on revenues of more than $157 billion), up from $10.3 billion (on revenues of $131 billion) in 2014. It seems unreasonable that this company made $11 billion dollars, that there is money to pay the CEO and senior officers tens of millions of dollars a year, but they don’t have the money to pay for the cost of treating low income families that pay for their products and services.

What is inherently true about insurance companies is that their basic philosophy is “Delay, deny, die!” The longer they can hold onto your money, without paying out your claims, the more money insurance companies make on the float. These companies also take advantage of the fact that if they deny a claim a certain percentage of the people will pay, even though the insurance company should have paid the bill. Insurance companies know the odds are on their side if they deny a claim; not everyone is up for a prolonged fight; especially if they are ill. If a person is at the end of their life, denying expensive, but life prolonging services costs money insurance companies don’t want to spend. If the insurance company waits long enough, the person may die, making the expense unnecessary.

We are sitting in our corner crying, acting like scared little babies, when, in truth, the power resides with us to control our costs and that power can be easily exercised by our states. It is time to say enough. If Blue Cross, United Health, Aetna, etc., want to sell any health insurance policy in your state, say a Medicaid or Medicare supplemental policy, if they don’t offer affordable individual policies in your state, then their license to do business in the state will not be renewed. The consequence of denying these companies access to a state’s markets is that they will have to close down. With all the losses they say they are suffering, the three largest insurance companies showed billions of dollars of profits in 2015. No license, no revenues. It is hard to believe that CEOs and their Boards of Directors will agree to close down their profitable businesses and give up their 10 million dollar plus annual salaries.

To control policy costs states have to get a handle on what percent of the money paid in in premiums is actually being paid out for claims. Based on CDC data, in aggregate, only about 5% of premium dollars received is actually paid out to providers of medical services. Which means 95% of dollars received is spent on price negotiation, claim review, and administrative costs. To get fair pricing for its citizens, the states have to require insurance companies offering policies to report back to that state the difference between money paid in for premiums minus money paid out for claims, for each individual policy and in aggregate. A reasonable standard should be set so that pricing reflects average risk in the state. For example, if a 70% threshold is set, insurance companies would pay out 70% of premium dollars received on care for their policy holders. The remaining 30% on the cost of conducting their business. Money earned on the float could be used to pay operating expenses.

In the end, it is going to be the states and their Departments of Insurance, who are going to have to step up. The states have the power. Only a states’ goverment can issue a license to a company to supply insurance products in their state and, in addition, their Department of Insurance typically approves each insurance product offered in their state. They can demand affordable pricing and regulate margins. If only they would.

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