4 ms·

The scenario the parent poster is describing is where ACA is repealed and replaced, and presumably that replacement would also do away with the 80% medical loss

by zrail 8y ago

The scenario the parent poster is describing is where ACA is repealed and replaced, and presumably that replacement would also do away with the 80% medical loss ratio. In that scenario the insurance companies will likely just not reduce premiums from what they are today, netting them a huge windfall. This is also why states like Alaska have seen ACA premiums fall over the past year or two. They instituted a state-wide reinsurance program, which means insurance companies' losses are capped at a reasonable amount per claim, then the state comes in and pays for the rest. This reinsurance program is funded in sort of a complicated manner, but basically it funnels the ACA tax credits that would have been paid to taxpayers, absent the reinsurance program, into the reinsurance program. Rates go down when insurance company losses are capped, either by a lifetime or annual benefit limit or by legislation that says they'll be made whole, because losses are predictable.

rayiner 8y ago
Even before the ACA, most money from premiums was paid out in benefits: https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/full/ https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/... > According to an April 2010 report prepared by the Democratic staff of the Senate Committee on Commerce, Science, and Transportation, the nation’s largest health insurers in 2009 had medical loss ratios ranging from 68 percent to 88 percent in the individual market; 78 percent to 84 percent in the small-group market; and 83 percent to 88 percent in the large-group market.
- zrail 8y ago
  For major medical plans, sure. Short term plans (which are still unregulated and should not be allowed to use the term "health insurance") generally have MLRs in the neighborhood of 50%. Also keep in mind, prior to ACA buying a major medical plan without through a large group required one to have no preexisting conditions. If you had one you were either denied or got an exception written into your policy that said they didn't have to cover anything related to that thing. That's one of the other major things that ACA did away with, and another reason premiums are higher.
- toomuchtodo 8y ago
  United Healthcare's CEO received $17.4 million in compensation last year. I don't know anyone on the GS pay scale making that. That excessive compensation could've been directed towards healthcare delivery instead of padding someone's pockets. Private insurance is beholden to shareholders, universal healthcare is beholden to citizen stakeholders. It's plainly obvious that the private insurance market in the US has failed us. Politics aside, from an economic efficiency perspective, it would be illogical for us to continue to operate the system as it currently exists. EDIT: This isn't an emotional appeal, it's an economic appeal to cut the fat of unnecessary, expensive bureaucrats who have no accountability except to their shareholders, and no involvement in the delivery of care. Private insurance interests are in the collection of their piece of total revenue, not care delivered. > Either way, the public is on the hook if the system is more generous. The public ends up on the hook regardless, whether that's through higher premiums, government subsidies, or diminished quality of life and lower life expectancy. Socialized losses, privatized gains.
  - rayiner 8y ago
    UHC paid out over $100 billion in care. How much it pays its CEO is completely irrelevant, except as an emotional appeal and rage bait. The system may not be functioning properly, but it has nothing to do with how much UHC's CEO makes, or shareholders make. (UHC's profit margin is just 7.5%). The decision of whether to have limits on how much you're willing to spend for one case exists whether you have a private system or a public system. Either way, the public is on the hook if the system is more generous.
    - deleted 8y ago
      [deleted]
    - FabHK 8y ago
      What strikes me as disingenuous about your posture is this: You are basically arguing that the insurers are introducing lifetime caps (making life much worse for the affected individuals, basically nullifying the whole point of insurance) not out of concern for their profit margin, but out of the goodness of their hearts to keep the premiums low for the paying public. That strikes me as unlikely. Of course, if you don't impose these limits, the costs must be borne by the collective insured. However, if there is one government/single payer insurer, nobody would ever dream up the insane idea of saying, hey, if you're really fucked, we'll stop paying your health bills, so we can shave off a few dollars of everyone's premiums.

by zrail 8y ago

rayiner 8y ago

Even before the ACA, most money from premiums was paid out in benefits: https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/full/ https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/... > According to an April 2010 report prepared by the Democratic staff of the Senate Committee on Commerce, Science, and Transportation, the nation’s largest health insurers in 2009 had medical loss ratios ranging from 68 percent to 88 percent in the individual market; 78 percent to 84 percent in the small-group market; and 83 percent to 88 percent in the large-group market.

zrail 8y ago
For major medical plans, sure. Short term plans (which are still unregulated and should not be allowed to use the term "health insurance") generally have MLRs in the neighborhood of 50%. Also keep in mind, prior to ACA buying a major medical plan without through a large group required one to have no preexisting conditions. If you had one you were either denied or got an exception written into your policy that said they didn't have to cover anything related to that thing. That's one of the other major things that ACA did away with, and another reason premiums are higher.
toomuchtodo 8y ago
United Healthcare's CEO received $17.4 million in compensation last year. I don't know anyone on the GS pay scale making that. That excessive compensation could've been directed towards healthcare delivery instead of padding someone's pockets. Private insurance is beholden to shareholders, universal healthcare is beholden to citizen stakeholders. It's plainly obvious that the private insurance market in the US has failed us. Politics aside, from an economic efficiency perspective, it would be illogical for us to continue to operate the system as it currently exists. EDIT: This isn't an emotional appeal, it's an economic appeal to cut the fat of unnecessary, expensive bureaucrats who have no accountability except to their shareholders, and no involvement in the delivery of care. Private insurance interests are in the collection of their piece of total revenue, not care delivered. > Either way, the public is on the hook if the system is more generous. The public ends up on the hook regardless, whether that's through higher premiums, government subsidies, or diminished quality of life and lower life expectancy. Socialized losses, privatized gains.
- rayiner 8y ago
  UHC paid out over $100 billion in care. How much it pays its CEO is completely irrelevant, except as an emotional appeal and rage bait. The system may not be functioning properly, but it has nothing to do with how much UHC's CEO makes, or shareholders make. (UHC's profit margin is just 7.5%). The decision of whether to have limits on how much you're willing to spend for one case exists whether you have a private system or a public system. Either way, the public is on the hook if the system is more generous.
  - deleted 8y ago
    [deleted]
  - FabHK 8y ago
    What strikes me as disingenuous about your posture is this: You are basically arguing that the insurers are introducing lifetime caps (making life much worse for the affected individuals, basically nullifying the whole point of insurance) not out of concern for their profit margin, but out of the goodness of their hearts to keep the premiums low for the paying public. That strikes me as unlikely. Of course, if you don't impose these limits, the costs must be borne by the collective insured. However, if there is one government/single payer insurer, nobody would ever dream up the insane idea of saying, hey, if you're really fucked, we'll stop paying your health bills, so we can shave off a few dollars of everyone's premiums.