On the cost side, what is the problem? The current private health insurance system is the most costly, wasteful, complicated, and bureaucratic in the world. Its main function is not to provide quality health care for all people but to make huge profits for companies. Private health insurance companies spend an incredible 30 percent of each health care dollar on administration and billing. Thirty cents of every dollar is not going to doctors, nurses, medicine, medical personnel; it is going to bureaucracy and administration plus exorbitant CEO compensation packages, advertising, lobbying, and campaign contributions. More efficient public programs such as Medicare, Medicaid, and the VA are administered for far less money, less than 10 percent.
From 2003 to 2007, the combined profits of the nation's major health insurance companies increased by 170 percent. William McGuire, the former head of United Health, several years ago, accumulated stock options worth an estimated $1.6 billion; CIGNA CEO Edward Hanway made more than $120 million in the last 5 years. CEO compensation for the top seven health insurance companies now averages $14.2 million. Over the last three decades, the number of insurance administrative personnel has grown by 25 times the number of physicians.
From 2003 to 2007, the combined profits of the nation's major health insurance companies increased by 170 percent. William McGuire, the former head of United Health, several years ago, accumulated stock options worth an estimated $1.6 billion; CIGNA CEO Edward Hanway made more than $120 million in the last 5 years. CEO compensation for the top seven health insurance companies now averages $14.2 million. Over the last three decades, the number of insurance administrative personnel has grown by 25 times the number of physicians.
The double whammy is that we get so little for so much spending. The US spends far more per capita on health care than any other nation, and health care costs continue to soar unsustainably, now at $2.4 trillion and 18 percent of our GDP. Our per capita spending is 40 percent more than the second most costly national system. The insanity is that we get poor value for what we spend. According to the World Health Organization, the US ranks 37th in terms of health system performance; we are far behind many other countries in terms of such important indices as infant mortality, life expectancy, and preventable deaths. Even the latest federal National Health Quality Report concluded: “health care quality in America is suboptimal…the health care system is not achieving the more substantial strides needed to close the gap or ‘quality chasm’ that persists.” ...
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