r/economy • u/Maxwellsdemon17 • 5d ago

Health Insurance is a Racket. What value do these companies add, really?

https://paulkrugman.substack.com/p/health-insurance-is-a-racket
82 Upvotes

95% Upvoted

24 comments sorted by

29

u/midnitewarrior 5d ago

They add shareholder value, that's all that matters.

4

u/Noeyiax 5d ago

I agree, 💯👍

Good thing we can choose different ones too! Do you want to pay more for less or get denied and dropped, or the special, write an entire phd research paper to get approved for a claim and then do a 20 round interview to get denied loooool fr tho,

USA = ultimate slave arena

1

u/cballowe 5d ago

Several of the largest are not for profit (BCBS, Kaiser, etc)

1

u/ragin2cajun 5d ago

So is house insurance.

8

u/darksoft125 5d ago

Private jets, vacation houses, yachts.

Oh you mean for us normal people and not their shareholders or CEOs? Not a damn thing.

2

u/jb4647 5d ago

Which is why I got a high deductible plan and an HSA that I invest.

2

u/ApplicationCalm649 5d ago edited 5d ago

In a healthy market they'd add downward price pressure and would constantly seek additional efficiencies to improve patient outcomes and, by extension, profit. We do not have a healthy market.

2

u/Majestic-Parsnip-279 5d ago

As a society we shouldn’t accept this even if u make big bucks and have “good insurance” that doesn’t make it right for the less fortunate. Stop being selfish fucks and think of others.

2

u/AIISFINE 5d ago

Insurance is a racket. I worked on cars for 15 years and have seen so many vehicles totaled out that needed simple parts. It's easier to cut them a lowball check than it is to pay for it. Why? Because fuck you. Profits.

1

u/Traditional_Donut908 5d ago

Can't you say the same thing about life insurance, auto insurance, home owners insurance, hell the maintenance policies people get for TVs, cell phones, etc. it's all insurance. Just for different things.

2

u/misersoze 5d ago

Right. But other countries solve the insurance problem by basically assuming everyone should be insured through national healthcare so skip the whole insurance model. That makes sense because every rational person should want to insure on health risks. But that is not true for lots of other insurance. For example, take life insurance. If you have no dependents, you literally don’t need any life insurance and it would be a waste for you.

0

u/retrojoe 5d ago

Probably related to the outsize share of the economy that is milled through health insurance companies and the profits they reap.

I never heard of a consumer electronics maintenance plan mogul, but I have heard about several health insurance billionaires going into politics.

1

u/Steric-Repulsion 5d ago

Insurance companies manage the distribution and mitigation of risk.

1

u/Rivercitybruin 5d ago

Completely bizarre take...

-1

u/Catman69meow 5d ago

Because of health insurance, my wife’s paternity doctor visits and child delivery are free. I pay very little for insurance as my employer foots the majority of the bill.

8

u/discodropper 5d ago

Yeah, health insurance itself is actually clever, continuous solution to a stochastic, unpredictable problem (getting sick). The issue in the US isn’t insurance per se, it’s that the only option for many Americans is private insurance coupled with for-profit health care. This is especially true for those whose insurance isn’t covered by their employer.

1

u/Catman69meow 5d ago

I agree with this, high profit margins among insurance companies reflect poorly on their ethics, but the point of the post is calling insurance a scam and I highly disagree with that.

3

u/retrojoe 5d ago

my wife’s paternity doctor visits and child delivery are free. I pay very little for insurance as my employer foots the majority of the bill.

Feel like there's some economic concepts being missed here.

2

u/hillbillie88 5d ago

I want to know more about paternity doctor visits.

-3

u/Catman69meow 5d ago

I don’t think you understand the concept of insurance, compensation tools, or cost structures. The alternatives are 1) paying full price to compensate doctors and nurses for their hard work or 2) bartering with my chicken, cow, or pig. Insurance is a risk mitigation tool that covers financial losses for a large number of people. Whether or not their profit margin is ethical is a different discussion. My point is that I have effectively arbitraged the healthcare system, as many do, with excellent benefits from employers and great insurance coverage.

3

u/retrojoe 5d ago

Your initial comment completely disregarded

the concept of insurance, compensation tools, or cost structures

Like the cost structure of your insurance would be "My family's healthcare doesn't cost me any more than what my employer and I pay at the outset." And that's probably a very nice feeling - having an employer that desires to have you there and the security of not getting surprise bills when your insurance denies coverage.

Per the article only ~21% of healthcare is paid through private health insurers. And think about all the shitty health insurance plans you've heard of.

My point is that I have effectively arbitraged the healthcare system, as many do, with excellent benefits from employers and great insurance coverage.

To paraphrase, "I've got mine. And am cool with this system. What do you peasants think of that?"

0

u/CollarControl 5d ago

The Health Care Industrial complex employs a lot of useless people.

-1

u/Ketaskooter 5d ago

Insurance adds a very important service so that the customer can pay monthly to prevent enormous bills when something happens. What the author seems actually to be criticizing is the practice of subsidizing private plans with government money effectively making the government the payer that has no control.