An American Single-Payer Health System is Inevitable. Here’s Why:


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Our current health insurance industry model is broken.  The necessary profits these INSURANCE companies take are killing us all.  This system is killing our incomes and destroying our ability to get affordable health care.    A single-payer health system is inevitable and Rick Unger’s policy page at  True/Slant   tells why:       LINK   

Amidst the ideological back and forth that is the health care reform debate of 2009, recent studies reveal a growing reality that each of us can easily understand, no matter what our ideological point of view.   It will not be long until the private health insurance model will no longer work –for anybody.   If annual premiums for family coverage grows, as expected, by an average of 8.7 percent per year over the next decade – as they did from 1999 to 2009 – premium costs will increase from the current average of $13,000 for the average family to more than $30,000 for the average family. As employees pay, on average, 28% of their premium costs with their employer paying the rest, that means that employee costs will go from $3,640.00 per year to $8,400.00 per year.

 

How many families do you imagine can afford $8,500 per year in health insurance premium costs, plus the large out-of-pocket costs for high deductible insurance plans? And how many companies do you imagine will be able to afford $21,600 per year in employee health insurance for each of their employees with a family?

Clearly, the employer health insurance model that accounts for 60% of health insurance coverage in this country is completely and unarguably unsustainable.   The next question is where it gets weird.

If the above is true – and the numbers make it pretty clear as to where this is going – wouldn’t the private health insurance companies adjust their model rather than commit suicide by pricing themselves out of business?

As counter-intuitive as it may seem, the answer is likely to be ‘no.’

Virtually all large health insurance companies are publicly held and public companies have a life force that is unlike any other. They are driven by the desire of current management to show improved profits of about 10% each year so as to sustain share price increases for the shareholders and compensation increases for management. Also understand that while public companies like to talk about the “long term”, the phrase has no true meaning to them.

Management and shareholders worry about this year’s numbers with an eye towards next year’s – and that is as far as it goes. Most shareholders and managers have no expectation of being around in the ‘long term.’

Thus, while current management of the large health insurance companies may very well realize  that they cannot sustain their business model for the longer term, this is not something they can afford to worry about. Their shareholders want returns on their investment as management wants boosts to their compensation and they are looking for it now. The future will be someone else’s problem.

Take virtually any failed industry in America and you will see that the dynamic set forth above is inevitably true. Whoever ran General Motors before the CEO in charge when the industry fell apart probably knew what was down the road for the company. But it wasn’t his problem. An adept shareholder in GM who got out five years ago, really didn’t care where the industry was headed nor did a CEO who had no plans to be around when the balls in the air crashed to the ground.

But when it’s health care? I think you will find that teabaggers everywhere will have a very different perspective when they find themselves out there alone with no way to pay for their family’s medical costs.

Who will need the save the day when this happens? The government will – and that means a single-payer system.

Whether the result fits your ideology or not, the numbers would seem to make clear that it is only a matter of time before private health insurance prices itself out of the market, leaving only the government with the capability to insure the nation’s health.

Given what appears to be a very dim future for the health insurance business model, one cannot help but conclude that the battle in Congress, while framed in ideological terms for public consumption, is really more about helping the insurance companies to earn as much money as they can before their inevitable collapse. After all, Congress is not unlike public companies in that elected officials tend not to worry beyond the next election cycle. When the insurance companies ultimately are priced out of the health business, and the government must take over, it will either be the next Congressman’s problem or enough time will have passed to allow constituents to forget the past ideologies of their representatives.   MORE at the LINK        There is also an excellent discussion following the article in which the author, Rick Ungar, responds to posters personally.

Here is one poster that understands the harsh reality of trying to keep up with the health insurance industry hell-bent on taking every last profit possible, at the detriment of his family’s small business’ bottom line:        

I’m already experiencing what you’re describing. I’m a single father with health insurance provided through my family’s paving business. My deductible is $2400, yet the company I work for pays roughly $13,000 a year for my insurance. I’ve been to the doctor once, and my daughter has been once this year. The only prescription I do have is a generic so I can get it for 4 dollars at Walmart. I’m not getting my money’s worth, and my family’s company is losing money hand over fist because of paying so much for employees’ insurance. I fully support the public option because of this. I also find it ridiculous as to the claims of death panels, because quite frankly, private insurance companies already have these. Some have been investigated because of policies to automatically deny any claims the first time, and hope the person goes away out of frustration. How can one say, that a private insurance company has the best interest of their clientele at heart, when their highest goal, due to being publicly traded, is to make high profits to please their shareholders…    –  –  nidomus


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