Since the 1980s, Americans have been told that inserting private health insurers as middlemen between patients and physicians will save money and improve care. After 40 years, that theory has failed at both.
Our six largest health insurers have been consolidating for many years, buying up smaller competitors and merging with big pharmacy benefit management companies (e.g. CVS merging with Aetna). Their revenues have quadrupled and profits have grown from about $12 billion in 2010 to more than $60 billion in 2021.
Insurers are also buying up physician practices and clinics. UnitedHealthcare is the largest physician employer in the country. This results in the company steering us toward providers that they own and/or operate.
With their supersized profits, insurance companies are spending more to influence public opinion, sometimes using misinformation to influence public policy as well as elections.
These companies are also making us pay more and more out of our own pockets through cost-sharing deductibles, co-pays and co-insurance before they pay a penny in actual health care. They aren’t paying nearly the same percentage of claims or the amounts of claims they used to pay because of their ability to shift more and more of the cost to us.
Most Americans don’t even have $400 in the bank, much less more than $17,000, which is the maximum out-of-pocket for a family policy. This has caused more than 1 million Americans to file for bankruptcy when they receive care. Eighty % of medical bankruptcies are individuals or families that have employer insurance!
Currently, our overall health care financing system is largely funded by the taxpayer in the United States. Americans pay higher health care taxes in the U.S. than any other developed country. We have a $4.3 trillion annual health care economy in the U.S. and approximately $3 trillion of that comes from taxpayers.
The supersized revenues of the big six health insurers last year totaled $1 trillion. They take the profit margin on that revenue, and reward shareholders and top executives, and still have plenty left over to spend on media, political contributions and lobbying our legislators. Very little is used to lower premium prices or offer better coverage.
Americans are also being priced out of pharmaceuticals these days. More than 45 million Americans forgo medications because of cost. Historically, Pharma quotes the cost of research and development as to why these prices are so high. The truth is that drug prices are not set according to research and development costs, but how much the market will bear. The largest pharmaceutical companies spend sometimes twice as much on marketing than research and development.
Pharmaceutical companies spend millions of dollars buying off competitors to stay away from their most profitable drugs, and to keep them out of the market and delay generic production. Insurance and medication inflation is due to unregulated monopoly power.
So what do we do about this bleak picture of health care? Pay attention to candidates running for office in each party. Attend town halls and Zoom forums and ask hard questions. Ask whether they’re taking money from health care special interest groups and PACs. Ask our current legislators if they do, too.
Health care is not about political parties, it’s about the legislators who write our laws in favor of corporations and don’t enforce antitrust laws. Indifference is how they maintain the status quo, which currently can cost us our lives and life savings. Voting is our power.
Health care and public education should be considered infrastructure. Healthcare and education are things everyone needs in their lives, and makes both our country and economy stronger. Our voice is our vote.
Jan Phillips, a retired small business owner. As a longtime health educator she is involved in advocating for health care reform.