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Post a CommentNot Such Obscene Profits After All
Monday, October 26th, 2009
House Speaker Nancy Pelosi recently said, "I'm very pleased that [Democrat leaders] will be talking, too, about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years."
Maryland Democrat Rep. Chris Van Hollen complained, "Keeping the status quo may be what the insurance industry wants their premiums have more than doubled in the last decade and their profits have skyrocketed."
MoveOn.org advertised, "Health insurance companies are willing to let the bodies pile up as long as their profits are safe."
Oddly enough, however, there's not a grain of truth in Democrats' hyperboles. Those evil insurance companies aren't making obscene or immoral profits after all.
The Associated Press, of all places, has the Fact Check:
Quick quiz: What do these enterprises have in common? Farm and construction machinery, Tupperware, the railroads, Hershey sweets, Yum food brands and Yahoo? Answer: They're all more profitable than the health insurance industry. In the health care debate, Democrats and their allies have gone after insurance companies as rapacious profiteers making "immoral" and "obscene" returns while "the bodies pile up."
Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent, give or take a point or two. That's anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.
Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year, as investors were warned of a stagnant if not shrinking market for private plans.
That 2 percent profit margin was good for 35th on the Fortune 500 list of top industries. But let's face it: Health care "reform" has little to do with profits and everything to do with control. Nancy Pelosi just wants you to hate insurers so you won't mind so much when she runs them.
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Steve
The notion that profits are "immoral" or "obscene" is to ignore the 'profitable' benefits of being a career politician.
Posted October 26, 2009 at 9:23:02 AM
G Dub
The current Administration and its croney controlled Congress is bent and determined to destroy the free market and control the US economy.
At a Town Hall (yeah, right ) meeting in late Aug, Sen Clair McCaskill-the-economy stirred up her supporters by declaring that the Insurance industry racked up an incredible $12,000,000,000 in profits in 2008. How horrible! Perish the thought that a "for-profit" industry would dare to make a profit. We in the know knew that that represented a 2.2% profit margin. What private enterprise CEO would be timid enough to announce to his shareholders a plan of that nature?!
Furthermore, she claimed that Obumble's HealthCare Reform plan would provide more "competition" in the healthcare market - isn't it interesting that LSDs ( Liberal Social Democrats ) employ free market jargon when it suits them? Here in Missouri there are 410 companies authorized to write business in the Health, Accident and Life arena. We don't need one - the Public Option - more.
Posted October 26, 2009 at 9:44:16 AM
K Honaker
It's apparently ok to ask the feds for a loan to shore up your place of business but not to make a profit! We need to fire all of them and start over.
Posted October 26, 2009 at 3:23:00 PM
JimH, MAJ, USA, RET
Insurance Companies, excutives, bonuses, Oh My!
We're not in Kansas, Toto. Get a grip. I don't care what another person, or company, or institution, or what-have-you makes in profit, as long as it is legal. But I do care that this administration, with the help of the legislature, is taking measures that are arguably not legal. The blame on "insurance companies" is pure politics. Very few people know their insurance company by the name of a person. The health insurer is a nameless, impersonal blob. I dare Reed, Pelosi, or any other to provide even one real name, one family, or a list of names of people who have profited in an "evil" manner from health insurance business. They won't because they can't, because there are none.
Posted October 26, 2009 at 5:52:08 PM
OregonBuzz
We've got to do something about "Big Ketchup". Heinz Co. posted an 8%+ profit last year and all the while "the bodies are piling up."
This is immoral and unconscionable. Why doesn't Big Government do something?
Posted November 1, 2009 at 10:18:24 AM
Ron
Less profit than the returns we'll see from "social security". Now that's obscene!
Posted November 4, 2009 at 4:35:52 PM