The Soapbox

Quaker

Joined: 08/13/1998 Posts: 2649
Likes: 2574


In a nutshell, the insurance company can make a % of what they pay out


So they make little effort to control costs. If a strep test costs $10, and they get 3%; that's 30 cents. If it costs $100, they get $3.

For example if you read your statement from CareFirst a strep test has a list price to insurance of $100. The technology involved is 20 or 30 years old. The cost per unit is probably $1.50 at most. Probably a fraction of that. Do you think the insurance company is pressuring the providers to drop the price down ~$2.00? Nope, their cut of $2 is much less than their cut of $100.

They are charging whatever the market will bear and paying it all back out to whoever. Yeah its sort of a cartel; but DOJ doesn't really look their way often. The closest agency to a form of enforcement I know of are state insurance commissions. If the state insurance commission lets them raise rates 10%, they take it smiling to the bank.

If the industry was the least bit competitive, this would never work. But are insurance companies competing to grab market share? Nope. I defy you to show me a single advertisement for health insurance. 3.5 trillion dollar industry and no one advertises? I will write this post and the internet will provide me with a Car insurance ads (I am looking at StateFarm auto right below where I am typing) but I've never seen a Health insurance ad pop up. Never seen one on TV either.

Doesn't that strike you as odd?

So to answer your question where does the money go

1) pharmaceutical industry
2) savvy hospitals that know how to best work the system
3) employees of the industries (Hospitals, Big Pharm, Insurance companies )
4) doctors I would hope though I've read that's not really the case
5) nurses and the like I would hope though not really the case

Where do you think the money is going? What don't you think we see the Geico Gecko or Caveman hawking Major Medical? What is the progression insurance spokeswoman's name? Aaron Roger's agent? Discount double check

By the way, my friend Google! says car insurance is more expensive in Canada than in the US.

[Post edited by Quaker at 11/07/2019 8:04PM]

(In response to this post by BocaHoo91)

Posted: 11/07/2019 at 8:02PM



+1

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