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Any lefty's want to explain this?

Posted by USNJIMRET, Mar 9 2010, 11:17 AM

I just watched about ten minutes of Barb Boxer from California explaining some 'wonderful' portions of the Health Care Bill and their immediate impact on Insurance Companies when signed into law.
What she said was, that upon signing this into law, Insurance companies would, by law, be rrequired to spend 80 to 85 percent of all money they took in on the actual insurance products for their customers.
I don't have any idea of this is a good idea or not.
I don't have any idea what the average is for income spent on products by insurance companies today. For all I know this is a nothing burger, and that insurance companies already spend that percent or close to it.
But the question I pose is this.....when the Government tells a business how much of it's income it is going to spend in a particular part of their business, how is that NOT the Government taking over the business?
It's not a private business when the Government starts, by law, telling you exactly how you spend your money.
Again, the argument I raise is NOT whether the amount of money spent is a good idea or not.
Only that the claims that this Reform isn't a Government take over are false when the 'private' business is ordered by the government to spend its money is a very specific manner.

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#1
wag-a-muffin, Mar 9 2010, 12:58 PM

Maybe we should just be grateful that the government isn't telling (or requiring) companies to spend 300% of the money the take in on their customers. I mean, that is the percentage our representatives are spending of the money we send them. And it is working SO well for Congress.

#2
USNJIMRET, Mar 9 2010, 01:17 PM

QUOTE (wag-a-muffin @ Mar 9 2010, 10:58 AM)

Indeed, one does have to wonder a bit about if the Congress Critters understand that they are just about the only folks in the country that "spend" in the deficit, and stay in 'business'.
Actually I don't wonder at all.
It helps to explain how the Congress can so easily look the American people in the eye and declare that forcing an increase in the number of people on medical insurance will not increase the cost to everyone else.
They don't believe that 2-2=0
They think 2-2=tax increase

#3
Mr. Naron, Mar 9 2010, 01:43 PM

I can't imagine any business settling on such a number even on their own. Sure they might find that they can generally provide the best customer service while making an adequate profit at that number, but they would never set it in concrete. That'd be business suicide.

#4
JOCS, USNR(RET), Mar 9 2010, 02:29 PM

QUOTE (Mr. Naron @ Mar 9 2010, 10:43 AM)

That, of course, is the whole idea. Once the civilian insurance companies are driven of business, one way or another, the only alternative to government-mandated coverage will be the government program (or, should that be "pogrom?"). Then watch what happens to the coverage -- and the premiums . . .

#5
katnapper, Mar 9 2010, 04:08 PM

There will be no way to tell and the only people who will be willing to buy the insurance at the rates they will have to charge will be the very sick, everyone else will just pay the fine. They will go broke.

#6
cobalt-blue, Mar 9 2010, 10:35 PM

One wonders where they count salaries and advertising?

#7
maxpower01, Mar 11 2010, 10:47 AM

The desire to trim overhead is due to the fact that we spend a much higher percentage of every health care dollar on overhead and administrative costs compared to countries with universal care, and administrative workers make up a larger share of the health care work force here than they do elsewhere. Also, insurance companies hire an order of magnitude more workers per enrollee compared to their counterparts in Canada (all of this is from a study in the [url=http://www.pnhp.org/publications/nejmadmin.pdfNew England Journal of Medicine[/url]).

QUOTE

In 1999, health administration costs totaled at least $294.3 billion in the United States, or $1,059 per capita, as compared with $307 per capita in Canada. After exclusions, ad- ministration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada. Canada’s national health insurance program had overhead of 1.3 percent; the overhead among Canada’s private insurers was higher than that in the United States (13.2 percent vs. 11.7 percent). Providers’ administrative costs were far lower in Canada.

Between 1969 and 1999, the share of the U.S. health care labor force accounted for by administrative workers grew from 18.2 percent to 27.3 percent. In Canada, it grew from 16.0 percent in 1971 to 19.1 percent in 1996. (Both nations’ figures exclude insur- ance-industry personnel.)