asks what we think is a very sensible question: where is the evidence that health insurers are price-gouging, monopolistic extortionists?
Everyone seems to hate the insurers — they’re held up as enemy #1 in the fight over healthcare reform — yet if they were really as awful as we assumed; if they really denied claims like crazy and kicked the sick off their roles with little or no thought, then you’d expect them to be insanely profitable, right?
But the evidence for that isn’t wild. One report linked-to by Cowen pegs them as the 35th most profitable industry. Other evidence is similarly squishy.
Now, this doesn’t exonerate insurance companies at all — they’re miserable to work with, as anyone who has dealt with some kind of serious illness or event knows full well. And they may be jerking their customers around. But if they’re so bad (and they have monopolies within each state) then why aren’t they wildly more profitable? What explains the divergence?
Or, is there counter-evidence that you can point to showing that in fact insurance companies are way more profitable than they should be.
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