[ETWolverine]

The truth revealed.

FACT CHECK: Health insurers' profits 35th of 53 - Yahoo! News

FACT CHECK: Health insurers' profits 35th of 53

By CALVIN WOODWARD, Associated Press Writer Calvin Woodward, Associated Press Writer Mon Oct 26, 10:06 am ET

WASHINGTON – 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."

But in pillorying insurers over profits, the critics are on shaky ground. 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.

Insurers are an expedient target for leaders who want a government-run plan in the marketplace. Such a public option would force private insurers to trim profits and restrain premiums to compete, the argument goes. This would "keep insurance companies honest," says President Barack Obama.

The debate is loaded with intimations that insurers are less than straight, when they are not flatly accused of malfeasance.

The insurers may not have helped their case by commissioning a report that looked primarily at the elements of health care legislation that might drive consumer costs up while ignoring elements aimed at bringing costs down. Few in the debate seem interested in a true balance sheet.

A look at some claims, and the numbers:

THE CLAIMS

_"I'm very pleased that (Democratic 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." House Speaker Nancy Pelosi, D-Calif. who also welcomed the attention being drawn to insurers' "obscene profits."

_"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." Maryland Rep. Chris Van Hollen, member of the Democratic leadership.

_"Health insurance companies are willing to let the bodies pile up as long as their profits are safe." A MoveOn.org ad.


THE NUMBERS:

Health insurers posted a 2.2 percent profit margin last year, placing them 35th of 53 industries on the Fortune 500 list. As is typical, other health sectors did much better — drugs and medical products and services were both in the top 10.

The railroads brought in a 12.6 percent profit margin. Leading the list: network and other communications equipment, at 20.4 percent.

HealthSpring, the best performer in the health insurance industry, posted 5.4 percent. That's a less profitable margin than was achieved by the makers of Tupperware, Clorox bleach and Molson and Coors beers.

The star among the health insurance companies did, however, nose out Jack in the Box restaurants, which only achieved a 4 percent margin.

UnitedHealth Group, reporting third quarter results last week, saw fortunes improve. It managed a 5 percent profit margin on an 8 percent growth in revenue.

Van Hollen is right that premiums have more than doubled in a decade, according to a Kaiser Family Foundation study that found a 131 percent increase.

But were the Bush years golden ones for health insurers?

Not judging by profit margins, profit growth or returns to shareholders. The industry's overall profits grew only 8.8 percent from 2003 to 2008, and its margins year to year, from 2005 forward, never cracked 8 percent.

The latest annual profit margins of a selection of products, services and industries: Tupperware Brands, 7.5 percent; Yahoo, 5.9 percent; Hershey, 6.1 percent; Clorox, 8.7 percent; Molson Coors Brewing, 8.1 percent; construction and farm machinery, 5 percent; Yum Brands (think KFC, Pizza Hut, Taco Bell), 8.5 percent.

___ Associated Press writer Tom Murphy in Indianapolis contributed to this report.

Is anyone going to take notice?

Probably not.

Elliot

[speechlesstx]

I was impressed that the AP noticed, but it won't go anywhere... doesn't fit the propaganda.

[paraclete]

The truth revealed.

FACT CHECK: Health insurers' profits 35th of 53 - Yahoo! News


Is anyone going to take notice?

Probably not.

Elliot

Elliot you make a lot of noise about insurance companies not making adequate profits, but isn't this the vaunted capitalist system in action. No organisation is entitled to super profits and many don't make big profits all the time. In any case the public interest is not well served by big profits being made from health care. What sort of investment do you think is neeeded to be an insurer. No millions invested in production only a building to operate from and someone to answer the phone, etc. Considering the investment required the returns are adequate

[speechlesstx]

Elliot you make a lot of noise about insurance companies not making adequate profits, but isn't this the vaunted capitalist system in action. No organisation is entitled to super profits and many don't make big profits all the time. In any case the public interest is not well served by big profits being made from health care. What sort of investment do you think is neeeded to be an insurer. No millions invested in production only a building to operate from and someone to answer the phone, etc. Considering the investment required the returns are adequate

Clete, surely you know insurance is purely a risk/reward enterprise which requires substantial investment, millions if not billions. You make it sound as if any ol' Joe can rent a shack and start an insurance company. Regardless it misses the point which is Democrats - starting from the top in Obama - are demonizing everyone from greedy tonsil vulture doctors to super greedy insurance companies preying on innocent health care victims for monstrous profits. The facts tell a different story, their profit margins are very thin, but the left needs an enemy to push whatever it is they have to sell instead of selling us something on its merits.

[ETWolverine]

Elliot you make a lot of noise about insurance companies not making adequate profits, but isn't this the vaunted capitalist system in action. No organisation is entitled to super profits and many don't make big profits all the time. In any case the public interest is not well served by big profits being made from health care. What sort of investment do you think is neeeded to be an insurer. No millions invested in production only a building to operate from and someone to answer the phone, etc. Considering the investment required the returns are adequate

Yes, this is indeed capitalism at work. And I have no problem with profits being that low if it happens naturally. That's the nature of business.

But the propaganda being produced by the White House and the Dems in Congress is saying that these insurance companies are "making obscene profits" and that this is the reason that the government has to step in and limit their profits in order to protect the nation.

The point is what "obscene profits" are they talking about? And if health reform is, at least in part, because of those "obscene profits", and that reason doesn't really exist, that is one less reason to go with the nationalization of health care.

This shoots one of the major arguments in favor of nationalized health care out of the water.

Elliot

[excon]

But the propaganda being produced by the White House and the Dems in Congress is saying that these insurance companies are "making obscene profits" and that this is the reason that the government has to step in and limit their profits in order to protect the nation.

Hello Elliot:

Not surprisingly, you don't understand stuff... It's NOT insurance company profits that's the problem. It's people dying from lack of health care...

How can you argue cogently when you don't even understand the issues?? The answer is, YOU CAN'T.

excon

[excon]

Hello again, Elliot:

The insurance companies CHOSE to BE insurance companies... I can't help it if people correctly link their dollars in profits, to DENIED coverage and DEATH.

That's just the way it IS in the health insurance business. If they were in the computer business, for example, nobody would say their profits correspond to dead people. But, with health insurance, you surly can say that.

excon

[George_1950]

Yes, I need Nanny to get me up in the morning, and Nanny to do my shopping, and Nanny to prepare my meals, and Nanny to clean my home, and Nanny to furnish my home, and Nanny to pay for my doctor, and Nanny to buy my clothes, and... I want those evil corporations and capitalists to just go away! YouTube - BARACK OBAMA KIDS AND HITLER YOUTH SING FOR THEIR LEADER

[NeedKarma]

Yes, I need Nanny to get me up in the morning, and Nanny to do my shopping, and Nanny to prepare my meals, and Nanny to clean my home, and Nanny to furnish my home, and Nanny to pay for my doctor, and Nanny to buy my clothes, and...I want those evil corporations and capitalists to just go away! YouTube - BARACK OBAMA KIDS AND HITLER YOUTH SING FOR THEIR LEADER

George, your posts are always very entertaining and fill me with a sense of schadenfreude.

[ETWolverine]

Hello Elliot:

Not surprisingly, you don't understand stuff... It's NOT insurance company profits that's the problem. It's people dying from lack of health care...

Really?

You wouldn't know it from these comments...

I'm very pleased that (Democratic 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." House Speaker Nancy Pelosi, D-Calif., who also welcomed the attention being drawn to insurers' "obscene profits."

"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." Maryland Rep. Chris Van Hollen, member of the Democratic leadership.

"Health insurance companies are willing to let the bodies pile up as long as their profits are safe." A MoveOn.org ad.

How can you argue cogently when you don't even understand the issues?? The answer is, YOU CAN'T.

Excon

Well, that explains why you can't seem to keep up...

You see, the Dems have been using several different arguments as their excuse to nationalize health care. These include

1) lack of accessibility of insurance
2) high cost of medical expenses and insurance premiums
3) pre-existing condition rules
4) the evils of the service providers
5) the evils of the insurance companies

I know that you would like to move the goal post again and make the discussion about those who are "dying due to lack of insurance". But that is only ONE of MANY arguments, and this article is addressing a different one.

I'll get to your argument and destroy it (as I have many times before) in a different thread, if you'd like.

Elliot

[tomder55]

Ex ;it puts a lie to the fallacies that you often cite about "obscene profits "these greedy insurance companies make. Are you now saying their profits aren't an issue ? You've come around. Because from an investors point of view ;I see more returns from scary Theresa Kerry's Heinz ketchup .
Heinz Still "America's Favorite Ketchup" | BNET Food Blog | BNET

[speechlesstx]

you surly can say that.

I think that's the problem in this debate, the Dems are "surly" in spewing all kinds of nonsense instead of being honest in their rhetoric and intentions.

Take Nancy Pelosi (please), yesterday she decided they needed another term for "public option" since that one isn't gaining any steam with the voters so she's trying to be as Orwellian as can be with “the consumer option” or as Debbie Wasserman Schultz thought, the “competitive option.”

She followed up with this, "You'll hear everyone say, 'There's got to be a better name for this,'" Pelosi said. "When people think of the public option, public is being misrepresented, that this is being paid for with their public dollars."

Let's see, so far Obama's half assed health care is going to cost around a trillion dollars of the public's money yet those who use the term "public option" are misrepresenting things? The Dems are being shamefully deceptive and dishonest and their rhetoric against the insurance companies is just one more example of that.

[George_1950]

George, your posts are always very entertaining and fill me with a sense of schadenfreude.

NK, didn't you enjoy the happy faces of all the children? Don't you just tingle?

[ETWolverine]

Hello again, Elliot:

The insurance companies CHOSE to BE insurance companies... I can't help it if people correctly link their dollars in profits, to DENIED coverage and DEATH.

That's just the way it IS in the health insurance business. If they were in the computer business, for example, nobody would say their profits correspond to dead people. But, with health insurance, you surly can say that.

excon

I see.

So do we link computer company profits with the number of computers that crash?

Do we link auto company profits to the number of car accidents?

Do we link beer sales to the number of cans of spilled beer?

No. For each of those industries we link profits to sales of a good product.

So, why with insurance companies do you (and so far it is ONLY YOU who are doing it) link profits to the number of dead people instead of the number of SATISFACTORY INSURANCE POLICIES SOLD?

Because it suits you to do so politically, not because it has anything to do with reality.

But all of this misses the point. The point is that Dems have been talking about the "obscenly high profits" of insurance companies, when in fact no such "obscenly high profits" exist.

Elliot

[NeedKarma]

NK, didn't you enjoy the happy faces of all the children? Don't you just tingle?

Godwin's law - Wikipedia, the free encyclopedia
"The term Godwin's law can also refer to the tradition that whoever makes such a comparison is said to "lose" the debate."

[excon]

Hello again, tom:

I'm easy. If profits are low like the Wolverine says, then I'll say it's not about profits... But, if the profits are high, like I say they are, then they're obscene.

If I'm not mistaken, the Wolverine once argued that those profit numbers don't really indicate whether an industry is profitable... He kept bringing up ROE, and stuff like that.. Actually, I'm NOT mistaken at all. That's exactly what he argued... Of course, it's HERE, and I'll find it if you insist...

So, you're not the only side who can pick numbers to fit your argument...

excon

[George_1950]

It would be convenient to just forget that both Hitler and Obama are socialists, wouldn't it? But didn't you enjoy the background, including piano, drums, and tambourines?

[ETWolverine]

Hello again, tom:

I'm easy. If profits are low like the Wolverine says, then I'll say it's not about profits... But, if the profits are high, like I say they are, then they're obscene.

If I'm not mistaken, the Wolverine once argued that those profit numbers don't really indicate whether an industry is profitable... He kept bringing up ROE, and stuff like that.. Actually, I'm NOT mistaken at all. That's exactly what he argued.... Of course, it's HERE, and I'll find it if you insist...

So, you're not the only side who can pick and choose numbers to fit your argument....

excon

Now I know that you haven't read the original post.

Because the OP speficically mentions (as I did in the posts from the past that you mention) PROFIT MARGIN, (aka profits as a % of total revenues), not actual dollars. This article in fact says EXACTLY what I said in past posts almost WORD FOR WORD.

The fact that you are acusing ANYONE of picking and choosing numbers when we are looking at the Same THING EVERY TIME WE POST ON THIS SUBJECT can only lead me to believe that 1) you didn't understand what we were posting LAST TIME, and 2) you didn't read the OP this time.

Go back to sleep, excon.

We'll wake you when its over.

Elliot

[George_1950]

"Nothing so epitomizes President Obama's own contempt for American values and traditions like trying to ram two bills through Congress in his first year – each bill more than a thousand pages long – too fast for either of them to be read, much less discussed. That he succeeded only the first time says that some people are starting to wake up. Whether enough people will wake up in time to keep America from being dismantled, piece by piece, is another question – and the biggest question for this generation." Dismantling of America

[NeedKarma]

Oh dear, you read and use WND as a credible source for anything. That is disturbing indeed.