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Their primary function is risk pooling. Secondarily they ration limited resources, attempting to distribute the available resources to effect the greatest good

Their primary function is risk pooling. Secondarily they ration limited resources, attempting to distribute the available resources to effect the greatest good (this is why you often have such a hard time getting them to cover things, and why everyone loves to hate them). They've also traditionally been in the business of managing moral hazard in such a way that people feel it necessary to sign up for insurance while healthy, but the government has dramatically changed that function in the last few years. There's also the basic book-keeping and shuffling money around the system ... and while all of the things I listed are somewhere in between crusted puke and a fresh horse turd in terms of their appeal, they are necessary functions that any system (even a government run one) has to perform. One huge advantage that the government has in the moral hazard department is that they can use guns and jail time to prod people into paying ... but for whatever reason the single-payer folks typically ignore that particular evil when campaigning against the private insurance companies. Personally, I feel that the government's tactic of taking someone's freedom for refusal to participate is much worse than refusing coverage, which is what the private companies do.

SubiculumCode 9y ago
When the whole nation is the pool, then there is no need for the insurance company.
- danjayh 9y ago
  The insurance company's methods of establishing the pool are far less coercive and destructive than the state's. Additionally, people can opt not to participate with an insurance company (or at least they used to be able to), so they have some motivation to be efficient and provide a basically decent level of service ... this is not true of the state. So establishing that large, mandatory pool has a downside.
  - SubiculumCode 9y ago
    Sometimes innovation is about figuring out ways to make more money, not by lowering costs to attract more consumers, but by limiting choices, creating illusion of choice, denying coverage, cheating consumers. Not all corporate innovation is good thing. Certain industries the possibility for real innovation is practically non-existent, and the 'innovation' that occurs is not in the public interest.
  - PixelB 9y ago
    >>Additionally, people can opt not to participate with an insurance company (or at least they used to be able to), so they have some motivation to be efficient and provide a basically decent level of service. You have the same backwards concept of Healthcare as everyone else who is rich; it's only for me. Healthcare is for everyone, it is a right. It is not a privilege that you only get if you can afford it. Health insurance is THE PROBLEM. If you don't have car insurance, you might be financially strained. If you don't have flood/fire insurance, you could loose your stuff. If you don't have health insurance (in this country) you could die. If you think these things are the same, there is no hope.
    - pstuart 9y ago
      I agree with what your saying but I'm bothered by the use of "right" -- I wish there was a better word. The US has the bill of rights and they're all effectively about "the right to be left alone". In the case of healthcare it is effectually a demand of the government. Because language frames the debate it would be nice to have a better word to describe this.
      - danjayh 9y ago
        I disagree with him, but agree with you, healthcare is not a right. As you stated, the natural rights enumerated by our constitution make no demands on others - in fact, they are the opposite - they guarantee protection from coercion by others. Anyone who believes in healthcare as an entitlement believe, effectively, that they are entitled to demand that others serve them without compensation. While there are cases where this is necessary at the federal level, healthcare is not one of them, and it's why it's not specifically mentioned in the constitution. Generally things like healthcare are better handled at the state level (and indeed, states were beginning to try before the feds stepped in). Handling these issues at a federal level enables people in the midwest to force people on the coasts to do things they'd rather not do, and vice-versa. Eventually, this leads to the kind of strife we've been seeing lately in the form of protests regarding healthcare.
        pstuart 9y ago
PixelB 9y ago
The primary function of insurance companies is to make a profit and serve their investors. These are publicly traded companies and only care about making that dollar; in this case, they make money by denying people healthcare and business is booming. Aetna for example has seen a 400% jump in their stock prices in the last 5 years.[1] You really do sound like you work for the insurance industry, claiming their functions are necessary (even though every other country manages without them). Also, government run healthcare is bad because they are going to shoot people (or threaten to) and put them in jail for not paying their medical bills? Come on.. are you serious? >>Personally, I feel that the government's tactic of taking someone's freedom for refusal to participate is much worse than refusing coverage, which is what the private companies do. Oh fuck right the fuck off. The government does not throw people in jail for not having health insurance or if they can not afford it. Refusing/denying coverage KILLS PEOPLE. You sound like someone who's got it made (so screw everyone else right?), and doesn't give 2 shits about anyone but themselves. [1]http://money.cnn.com/quote/quote.html?symb=AET http://money.cnn.com/quote/quote.html?symb=AET
- jdhn 9y ago
  >Aetna for example has seen a 400% jump in their stock prices in the last 5 years. In all honesty, what would you expect? The ACA forced millions of people who didn't have health insurance to buy health insurance, and investors responded accordingly by buying the shares of companies who benefited from an influx of new customers.
- maxerickson 9y ago
  My insurer covers about 1% of the country. It's a private non-profit. There are lots of others. Of course they pay lots of compensation to people that work there, but the members are effectively disinterested shareholders.
- nradov 9y ago
  That is simply wrong. Most health "insurance" companies no longer provide much actual insurance anymore. Instead they provide claims payment and administration services for self-insured employers who bear the risk. Furthermore the ACA imposed a minimum medical loss rate. So insurers have little financial incentive to deny claims anymore.

SubiculumCode 9y ago

When the whole nation is the pool, then there is no need for the insurance company.

danjayh 9y ago
The insurance company's methods of establishing the pool are far less coercive and destructive than the state's. Additionally, people can opt not to participate with an insurance company (or at least they used to be able to), so they have some motivation to be efficient and provide a basically decent level of service ... this is not true of the state. So establishing that large, mandatory pool has a downside.
- SubiculumCode 9y ago
  Sometimes innovation is about figuring out ways to make more money, not by lowering costs to attract more consumers, but by limiting choices, creating illusion of choice, denying coverage, cheating consumers. Not all corporate innovation is good thing. Certain industries the possibility for real innovation is practically non-existent, and the 'innovation' that occurs is not in the public interest.
- PixelB 9y ago
  >>Additionally, people can opt not to participate with an insurance company (or at least they used to be able to), so they have some motivation to be efficient and provide a basically decent level of service. You have the same backwards concept of Healthcare as everyone else who is rich; it's only for me. Healthcare is for everyone, it is a right. It is not a privilege that you only get if you can afford it. Health insurance is THE PROBLEM. If you don't have car insurance, you might be financially strained. If you don't have flood/fire insurance, you could loose your stuff. If you don't have health insurance (in this country) you could die. If you think these things are the same, there is no hope.
  - pstuart 9y ago
    I agree with what your saying but I'm bothered by the use of "right" -- I wish there was a better word. The US has the bill of rights and they're all effectively about "the right to be left alone". In the case of healthcare it is effectually a demand of the government. Because language frames the debate it would be nice to have a better word to describe this.
    - danjayh 9y ago
      I disagree with him, but agree with you, healthcare is not a right. As you stated, the natural rights enumerated by our constitution make no demands on others - in fact, they are the opposite - they guarantee protection from coercion by others. Anyone who believes in healthcare as an entitlement believe, effectively, that they are entitled to demand that others serve them without compensation. While there are cases where this is necessary at the federal level, healthcare is not one of them, and it's why it's not specifically mentioned in the constitution. Generally things like healthcare are better handled at the state level (and indeed, states were beginning to try before the feds stepped in). Handling these issues at a federal level enables people in the midwest to force people on the coasts to do things they'd rather not do, and vice-versa. Eventually, this leads to the kind of strife we've been seeing lately in the form of protests regarding healthcare.
      - pstuart 9y ago

PixelB 9y ago

The primary function of insurance companies is to make a profit and serve their investors. These are publicly traded companies and only care about making that dollar; in this case, they make money by denying people healthcare and business is booming. Aetna for example has seen a 400% jump in their stock prices in the last 5 years.[1] You really do sound like you work for the insurance industry, claiming their functions are necessary (even though every other country manages without them). Also, government run healthcare is bad because they are going to shoot people (or threaten to) and put them in jail for not paying their medical bills? Come on.. are you serious? >>Personally, I feel that the government's tactic of taking someone's freedom for refusal to participate is much worse than refusing coverage, which is what the private companies do. Oh fuck right the fuck off. The government does not throw people in jail for not having health insurance or if they can not afford it. Refusing/denying coverage KILLS PEOPLE. You sound like someone who's got it made (so screw everyone else right?), and doesn't give 2 shits about anyone but themselves. [1]http://money.cnn.com/quote/quote.html?symb=AET http://money.cnn.com/quote/quote.html?symb=AET

jdhn 9y ago
>Aetna for example has seen a 400% jump in their stock prices in the last 5 years. In all honesty, what would you expect? The ACA forced millions of people who didn't have health insurance to buy health insurance, and investors responded accordingly by buying the shares of companies who benefited from an influx of new customers.
maxerickson 9y ago
My insurer covers about 1% of the country. It's a private non-profit. There are lots of others. Of course they pay lots of compensation to people that work there, but the members are effectively disinterested shareholders.
nradov 9y ago
That is simply wrong. Most health "insurance" companies no longer provide much actual insurance anymore. Instead they provide claims payment and administration services for self-insured employers who bear the risk. Furthermore the ACA imposed a minimum medical loss rate. So insurers have little financial incentive to deny claims anymore.