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Viewpoints: Letters / Opinions

Private Health Insurance is gouging us

By Michael Spence


April 05, 2017
Wednesday PM

According to Alaska Dispatch News, Premera Lifewise of Alaska recently announced it had profited $18 Million from Obamacare plans last year, and another $20 Million in Individual Health plans. These figures were sharply higher than what the company officially predicted which was $2.7 Million.During the same year, it was reported, the deficit-bound State of Alaska subsidized Health Insurance industry in Alaska to the tune of $55 million dollars.

All the while , Blue Cross and other health insurers have been complaining to state and federal regulators that their profits are not high enough to do business in Alaska.

Alaska is a case in point of what is wrong with the private Health Insurance business nationwide. The companies that participate in this business enjoy market protections (antitrust exemptions and subsidies) in federal law and state law, while consumers are gouged. The profits of private insurance companies are guaranteed, but the health care of our citizens is not. How can the US Congress tell constituents that this flawed system is necessary?

The ploy of Health Insurance companies has long been; they first establish through lobbying Congress anti-competive regulation that gives exclusive access to markets, and then they cherry pick those markets nationwide, with the big players only participating in the most lucrative ones.

The practices enabled by Congress in the Health insurance business have obvious consequences to the economy of our state and our country. They also have serious health consequences to the Alaska people. For example, a typical high-deductible patient who goes to a clinic with a health issue, is screened at the front counter from getting medical tests that might benefit him/her, when the insurance company is not going to pay one penny for the test anyway! Clearly the seven thousand dollar (and going higher every day) annual deductible is calculated so that in most cases the Insurance company pays nothing but receives income from every denied patient. Many patients in the United States are not diagnosed of serious illnesses because of this flawed system.

A high-cost inefficiency is introduced by the standard practice of filtering every single claim through the Insurance company. This practice is ordained by the Insurance lobby because a large portion (forty percent of the total cost of health care by many public estimates is administrative) also goes directly into the profit mechanism. The more inefficient it is, the more the Insurance company profits.

The US Congress owes their constituents and our country a better deal. There are solutions beyond the latest effort in the dead-for-now Ryan health care initiative, which proposed that more Americans should be uninsured. Medicare and Medicaid should be broadened to insure all citizens regardless of age. This is what most of the developed world does. Private insurance can and should compete with public insurance. Some of the world's biggest and arguably best insurance companies are based in other countries and not allowed to compete in the USA. Congress should stop the abuse of the private health insurance market and encourage national and international competition. Contrary to the latest Congressional initiative, health care is not a privilege. It is a civil right of all Americans, just as it is in most of the developed world. Congress should also do the honorable thing and put themselves on the same policy as all Americans .

Michael Spence
Ketchikan, Alaska


About: "a long-time consumer of health insurance"

Received April 05, 2017 - Published April 05, 2017

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