In a week when the Republicans attacked Planned Parenthood, the freedom of workers to bargain for a better life, programs that help middle class families and a whole lot more, the one thing they didn’t challenge was the excessive profits of the health insurance industry.
In fact, they continued their relentless effort to undermine the Affordable Care Act, which will eliminate the worst of insurance company abuses (like arbitrary denials of our care) and put a check on out-of-control profits that fuel rising premiums that are crushing families and small businesses.
Yesterday Health Care for America Now released a report that shows that the big five insurers earned $11.7 billion in 2010 - a 51% increase since 2008 - as they cut the number of people insured by millions and reduced the share of premiums they spend on actual medical care. So they made more money by charging more and providing less. It’s a great business model if you can swing it - sell a product for higher and higher prices, offer less and then try to deny services to your paying customers when they actually need it.
The big profit gains were led by UnitedHealth, which reported $4.6 billion in earnings last year, up 21 percent from the 2009. WellPoint, the parent of Blue Cross plans in 14 states, including New York, California, Virginia, Georgia, Missouri and Ohio, earned $2.9 billion, up 13 percent from 2009; Aetna made $1.8 billion, up 38 percent; Cigna recorded $1.3 billion, up 3 percent; and Humana took $1 billion, up 6 percent.
Unsurprisingly, the health insurance industry trade group didn’t like our report. Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, described our conclusions as “misleading attacks … motivated by an unpopular ideological agenda that seeks to destroy an important industry and turn the entire system over to Washington.”
Wow. That’s a tad hyperbolic, and it’s not true. But it’s hard to like an industry that makes money by avoiding risk and providing less care, and that is one of the largest political sponsors of congressional Republicans and spends millions to protect its uncontrolled ability to make unlimited profits.
According a report by Public Campaign Action Fund, these five companies alone spent nearly $50 million lobbying lawmakers from 2008 to 2010, and their employees and political action committees spent more than $7.3 million on campaign contributions. Imagine what the rest of their industry spent!
Of course it’s no shock that America’s big insurance companies make huge amounts of money and then spend millions to own the Republican Party, which then protects their ability to make excessive profits and pay bloated CEO salaries. This is exactly why the consumer protections in the Affordable Care Act are so important. And it’s what’s wrong with a political system dominated by corporate money instead of people.