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Hit men aren't what you think

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Re: Hit men aren't what you think

#251

Post by nradov »

oskarkk wrote: post #245
michaeljx wrote: post #113

I don't understand the comments excusing the CEO of his responsibility. I work for a scale-up insurance company, and the CEOs are pretty clear with their mandate: customer service is paramount, we make money by streamlining our processes, negotiating hard with our network, and pricing properly our products. NOT by denying claims. This philosophy is enforced from the top all the way down, with Chinese walls between pr…

But wouldn't denying less claims necessitate raising prices? I see stats like these: https://i.redd.it/7aa6zytdox4e1.jpeg If the company is denying so much claims (32%), and they have quarterly profit around $6B on $100B revenue (and they had less profit in earlier quarters, even a loss in Q1), I think they would need to raise prices to stop denying most claims that they deny. And what then? Someone would kill the CE…

Denying claims generally doesn't improve health insurance company profits. It's not like auto or homeowner's insurance. Due to the minimum medical loss ratio rule, insurers can generally increase their profits by approving more claims. Their most important customers are self-funded employers.

https://www.cms.gov/marketplace/private-health-insurance/med...

When insurers tighten their claim approval policies it's usually due to pressure from those self-funded employers to control costs. If employers wanted it, insurers would be happy to sell custom health plans that would pay every claim with zero denials; this would be enormously profitable for insurers because they wouldn't have to do any work.

Claim approval or denial rates don't have much direct impact on consumers being able to afford insurance. Most of the cost is borne by employers, and low-income consumers who buy individual policies through the exchanges receive government subsidies. But of course that indirectly impacts all of us through lower wages and higher taxes.

Re: Hit men aren't what you think

#252

Post by FireBeyond »

lotsofpulp wrote: post #229
FireBeyond wrote: post #189

Earlier quoted context omitted.

This rather ignores the role of health "insurers", third party administrators, repricing specialists and every other middle man that contributes more significantly to the price of healthcare than the actual cost of providing that care.

In the US healthcare chain, the ranking of profit margins goes (and this is public info from public financials): Pharmaceutical companies 20%+ Healthcare software companies (based on other software company margins). 20%+ Healthcare providers (doctor groups) Hospitals (HCA, tenet, etc) 10%+ Managed care organizations (MCOs, health insurers), retail pharmacies, and medicine distributors at the very bottom. ~2% Legal is…

> They are just allocating the very limited resources among more and more demand.

Are you saying that the same populations are getting more and more sick and ill? Citation needed for that. Or are they costing more and more money? And if so, why?

Wouldn't be health insurers setting up middlemen of their own (PBS, etc.) to get around legal caps on their own profit margins, would it?

> Legal is also up there. Those millions and tens of millions of dollar judgments don’t come from thin air.

Malpractice payouts are by and large a boogey man. Texas has had them capped for years and shockingly, malpractice insurance costs are effectively identical to what they were before. As an aside, malpractice insurance in itself isn't typically as onerous as people believe it to be. What is onerous, and what that industry does differently to most other insurance segments is "tail insurance".

Tail insurance is the concept that major malpractice suits may appear well after your claims-made liability policy has ended. In most cases it's actually DOUBLE the premium you're paying for malpractice insurance, implying the insurer believes that your coverage is less than one-third of the claims they expect to pay. What -should- happen is that you carry "claims-made and prior acts" coverage. The challenge there is that in many cases your employer will cover claims-made as part of your compensation or part of their insurance, but don't elect prior acts coverage (and because of the way they do it, I suspect it's not as simple as "let me pay the difference").

But in general capping malpractice payouts has done nothing to offset malpractice coverage costs, let alone flow-through to end consumer costs.

Re: Hit men aren't what you think

#253

Post by gruez »

Ygg2 wrote: post #247
wholinator2 wrote: post #246

Earlier quoted context omitted.

How did we enter a world in which the only given fact that must be held true is that "the business profit will grow unceasingly for all time, no matter the consequence" Instead of, "the human beings that we serve matter, and our duty to them comes before all else. We will profit by being the best in the market" I think monopoly and MBAification of every leadership position at every company in at least America. Some o…

> How did we enter a world in which the only given fact that must be held true is that "the business profit will grow unceasingly for all time, no matter the consequence" What do you mean enter? This was always the model of capitalistic acquisition. Early industrial revolution was not known for it's blue skies, labor friendly laws and preventing children from working in the mines. The moment you have inflation, which…

>This was always the model of capitalistic acquisition. Early industrial revolution was not known for it's blue skies, labor friendly laws and preventing children from working in the mines.

Except for "blue skies", the other things you've listed are the default state of nature. Children worked the moment they were able. Even without a capitalist boss, people worked their asses off during the planting/harvest season under the threat of starvation. The other rest of the year might be more lax, but you're still desperately praying that drought or disease won't wipe away your hard work and leave you starving regardless.

Re: Hit men aren't what you think

#254

Post by nradov »

acdha wrote: post #249
oskarkk wrote: post #245

Earlier quoted context omitted.

But wouldn't denying less claims necessitate raising prices? I see stats like these: https://i.redd.it/7aa6zytdox4e1.jpeg If the company is denying so much claims (32%), and they have quarterly profit around $6B on $100B revenue (and they had less profit in earlier quarters, even a loss in Q1), I think they would need to raise prices to stop denying most claims that they deny. And what then? Someone would kill the CE…

That’s profit, not basic functionality. If they denied claims at the level KP does, the CEO would still be a millionaire but they’d be spending tens of billions of dollars of the money their customers are paying for healthcare on healthcare instead of diverting it to shareholders. This should be like a regulated utility, not a private equity fund: comfortable living but nobody should be getting wildly rich because th…

Quality of outcomes depends on what metric you look at. In some ways the US healthcare system is excellent, in other ways terrible. For example, the US is at or near the top for 5-year survival rates for most types of cancer.

The major factors driving increased morbidity and mortality for Americans are mostly outside the healthcare system. Overeating, trauma, substance abuse, sedentary lifestyles, etc.

Re: Hit men aren't what you think

#255

Post by _yb2s »

FireBeyond wrote: post #192
big-green-man wrote: post #4

This is an interview with someone presented as some type of expert that obviously is not an expert. 1) it is not hard to get a silencer. You can make one in under an hour with cheap parts from a hardware store and a drill. 2) the CEO was at a conference. It's not surprising that this person "knew he would be there", it's interesting that this interviewee stresses this point like it is some big one to be made. The CEO…

> 1) it is not hard to get a silencer. You can make one in under an hour with cheap parts from a hardware store and a drill. You could, may even still can, buy them on Amazon. For a while there was a big market on Amazon for "lawnmower mufflers" that were pretty blatant nudge nudge wink wink: "This muffler fits lawnmowers with a 9mm exhaust. I was able to use my lawnmower all morning long and my neighbor could barely…

Oh man, 9mm exhaust. Reminds me of the non EPA compliant fuel can spouts that say “for use with water only” and “not drinking water safe.”

Re: Hit men aren't what you think

#256

Post by nradov »

michaeljx wrote: post #135
avalys wrote: post #134

Earlier quoted context omitted.

Is this a health insurance company or are you providing property insurance?

No this is general insurance (motor, property, travel etc). It is also founder-led, which is an important factor, as the reason they started it was their personal frustration with the motor insurances.

Your experience in general insurance has nearly zero relevance to US health insurance. Their main customers are large self-funded employers and they operate under a completely different legal regime. Most of their business is no longer even "insurance" in the traditional sense.

Re: Hit men aren't what you think

#257

Post by lotsofpulp »

FireBeyond wrote: post #252
lotsofpulp wrote: post #229

Earlier quoted context omitted.

In the US healthcare chain, the ranking of profit margins goes (and this is public info from public financials): Pharmaceutical companies 20%+ Healthcare software companies (based on other software company margins). 20%+ Healthcare providers (doctor groups) Hospitals (HCA, tenet, etc) 10%+ Managed care organizations (MCOs, health insurers), retail pharmacies, and medicine distributors at the very bottom. ~2% Legal is…

> They are just allocating the very limited resources among more and more demand. Are you saying that the same populations are getting more and more sick and ill? Citation needed for that. Or are they costing more and more money? And if so, why? Wouldn't be health insurers setting up middlemen of their own (PBS, etc.) to get around legal caps on their own profit margins, would it? > Legal is also up there. Those mill…

> Are you saying that the same populations are getting more and more sick and ill? Citation needed for that. Or are they costing more and more money? And if so, why?

The citation is the population pyramid flattening out and turning upside down eventually. That means more and more old (and hence sick) people, and fewer and fewer care providers (young people). Also, there are a lot more treatment option, and sick people being kept alive longer.

> Wouldn't be health insurers setting up middlemen of their own (PBS, etc.) to get around legal caps on their own profit margins, would it?

No, absent enormous fraud, all revenue and expense is reflected on a company’s 10-K. UNH/Elevance/Cigna/Humana/CVS/etc all have multiple lines of business (like most other large businesses), but the final profit margin figures are what they are including all lines of business.

Thanks for the info on tail insurance, I didn’t know that.

Re: Hit men aren't what you think

#258

Post by dh2022 »

chiph wrote: post #250
oskarkk wrote: post #245

Earlier quoted context omitted.

But wouldn't denying less claims necessitate raising prices? I see stats like these: https://i.redd.it/7aa6zytdox4e1.jpeg If the company is denying so much claims (32%), and they have quarterly profit around $6B on $100B revenue (and they had less profit in earlier quarters, even a loss in Q1), I think they would need to raise prices to stop denying most claims that they deny. And what then? Someone would kill the CE…

When I shop for insurance my #1 priority is seeing if the company will pay a claim. Either because they have the reserves, or because of corporate policy. Premium cost is #2. What I have observed is that starting about 8-9 years ago any retail insurer that uses a mascot in their advertising, is difficult/slow to pay a claim. Both to other insurance companies who are being forced to subrogate to make their own custome…

How do you find out this information? Are there any websites that publish this information? Are these websites reliable/reputable ? Thanks!!!

Re: Hit men aren't what you think

#259

Post by glimshe »

chomskyole wrote: post #237
glimshe wrote: post #236

Earlier quoted context omitted.

Letting somoene die to make more money is violence. But letting a hospital go bankrupt, which will eventually lead to others dying, would be no better. We still struggle with the life and death decisions related to allocating capital do healthcare. Even single payer systems have this problem. We can start by looking at what profit margins and administrative expenses are reasonable for health businesses. The free mark…

> The free market generally solves these questiins, but it's notoriously deficient when it comes to healthcare. Can you please elaborate on this part? I don't see how this could be solved by market forces. EDIT: Making healthcare for profit, would always put someone's life against someone else's new yacht. Is this how we want to assess these situations?

It can't, that's why I said it's deficient when it comes to healthcare. Market forces are good at balancing capital allocations in general.

Re: Hit men aren't what you think

#260

Post by motorest »

nradov wrote: post #256
michaeljx wrote: post #135

Earlier quoted context omitted.

No this is general insurance (motor, property, travel etc). It is also founder-led, which is an important factor, as the reason they started it was their personal frustration with the motor insurances.

Your experience in general insurance has nearly zero relevance to US health insurance. Their main customers are large self-funded employers and they operate under a completely different legal regime. Most of their business is no longer even "insurance" in the traditional sense.

OP's point is orthogonal to whatever legal regime is in effect. OP's point was that fraudulent claims are at a residual level. If anything, general insurance is expected to have higher rates of fraudulent claims than health insurance.
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