NEW REPORT SHOWS HEALTH INSURERS LYING ABOUT REASON FOR PREMIUM HIKES
Private Insurers Spent $716 Billion On Profits and Overhead from 2000 to 2008
***Read the Report: HealthCareForAmericaNow.org/Debunk***
Listen to the press conference call:
Washington, DC - On a national conference call with reporters today, Health Care for America Now (HCAN) – the nation’s largest heath care campaign – released a new report showing that contrary to insurance industry claims that medical costs are driving double-digit health insurance rate increases across the country, the insurance industry’s actual medical costs have grown far more slowly than premiums. From 2000 to 2008, premiums for families enrolled in employer-sponsored health plans increased 97 percent while premiums for individuals enrolled in employer-sponsored health plans climbed 90 percent. At the same time, private insurers’ payments to health care providers rose 72 percent, and medical inflation increased 39 percent.
In The Wall Street Journal today, WellPoint CEO Angela Braly reportedly defends rate increases by blaming “doctors and hospitals” for driving up costs, and in The Washington Post on Sunday, an America’s Health Insurance Plans (AHIP) spokesman insisted “underlying medical costs and not health plans” are “driving health-care prices in this country.”
Today’s report titled “Health Insurers Falsely Claim Rising Costs Justify Soaring Premiums” proves insurance companies are paying less and less for patients’ medical care and more and more on administrative expenses, profits, CEO salaries, and perks.
From 2000 to 2008, family premiums grew more than three times faster than wages, more than twice as fast as medical inflation, and nearly five times faster than general inflation. Meanwhile, health insurers’ profits and administrative costs consumed $716.4 billion of the premiums insurers collected - a sum nearly equal to the entire 10-year cost of health reform.
“Health insurers have some nerve blaming doctors and hospitals for rate hikes when premiums are dramatically outpacing medical costs,” said Richard Kirsch, National Campaign Manager, Health Care for America Now. “Every day, health insurers spend a bigger chunk of our premiums on profits, CEO salaries, and perks. We’ll never fix health care without reining in the insurance companies.”
“This report exposes the deadly spin the insurance industry is engaged in and presents the truth in indisputable detail,” said Wendell Potter, former CIGNA VP of corporate communications and now Senior Fellow at Center for Media and Democracy. “The insurance industry is working hard, spending millions of our premium dollars, on a propaganda campaign designed to either kill reform or make sure reform benefits insurance companies and their shareholders far more than average working Americans.
“The big for profit-companies that now comprise a cartel in the industry are accountable first and foremost to their shareholders, and they will promise to do whatever it takes to meet those shareholders’ expectations and the expectations of a handful of enormously influential and powerful financial and investment analysts,” Potter added. “The insurers are spending most of their sales and marketing budgets - which come from premiums their customers pay - trying to take profitable customers away from each other. They call that stealing market share which is appropriate because sometimes these companies behave like thieves and thugs.”
***Read the Report: HealthCareForAmericaNow.org/Debunk***
