Re:How to get rich without getting lucky
by frgtpsswrdlame on Friday June 01, 2018 @09:55AM
(#17205317)
So insurance in the US wants to take even more than 20% as profit? Am I correct in thinking that this actually makes socialized systems more efficient? They never have to front any profit overhead.
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Re:How to get rich without getting lucky
by Someone1234 on Friday June 01, 2018 @10:01AM
(#17205382)
No, they want to increase how much that 20% share is worth.
If premiums increase from e.g. $500 to $600/month, the insurance company makes $20 more per insured via their 20% share.
The other 80% ($480) really does go towards medical costs, but the issue is that insurance companies aren't incentivized to help you keep those medical costs down (via negotiation with hospitals/drug companies), but may be incentivized to increase them. That's a problem.
In an ideal world insurance company's incentives and their customer's goals should be aligned (e.g. both save money). That makes them the ultimate advocate for you and fighting to keep healthcare costs low, that isn't what is happening (either before or after Obamacare).
Not profit. The 20% is supposed to cover all overhead. 80% is mandated to be spent directly on claims.