The Obama administration, the congressional Democratic leadership, and their Liberal base have made a tactical decision to demonize health-insurance profits as part of their drive to force ObamaCare upon the United States of America.
In the heated words of a great and pissed-off American, Rep. Joe Wilson (R-SC), “You Lie!” But mendacity is something that Americans have come to expect from the Leftists.
Let us look at the Market Caps and the Net Profit Margins of the segments of American industry that are related to healthcare. Let’s see where these supposedly obscene profits actually are.
From Yahoo Business – Quarterly Results as of October 9, 2009, limited to Healthcare Industry Segments:
|Industry||Market Cap||Profit Margin|
|REIT – Healthcare Facilities *||$27.65B||28.00%|
|Drug Manufacturers – Major||$1018.30B||17.00%|
|Healthcare Information Services||$16.59B||9.00%|
|Home Health Care||$6.27B||8.90%|
|Medical Instruments & Supplies||$211.48B||8.80%|
|Medical Laboratories & Research||$30.50B||7.80%|
|Drugs – Generic||$10.52B||6.50%|
|Drug Manufacturers – Other||$158.68B||5.10%|
|Accident & Health Insurance||$38.83B||4.00%|
|Health Care Plans||$87.31B||3.30%|
|Medical Equipment Wholesale||$12.44B||3.00%|
|Drug Related Products||$13.48B||2.80%|
|Specialized Health Services||$16.02B||2.60%|
|Medical Appliances & Equipment||$122.48B||1.50%|
|Long-Term Care Facilities||$6.70B||-3.80%|
|NOTE: REIT is an abbreviation of Real Estate Investment Trust. It is a tax designation for a corporation investing in real estate that reduces or eliminates corporate income taxes|
As is usual and expected, reality does not bow to the will, whims, and/or delusions of President Obama and his Liberals. As you can see, those segments of the Healthcare industries that deal with health insurance operate at a mere 3 – 4% profit margin. I don’t think any sane person would consider 3 -4% as an obscene profit margin; most would consider it pathetic and wonder how and why the industry continued to exist.
Look at the bottom of the table and see what healthcare industry segments are failing. It’s not pretty and it will eventually hurt America severely.
Obama and his Liberals’ phantasmagoria also run afoul of the issue that health insurance makes up only a tiny fraction of the whole of the healthcare industry. The combined Market Cap of the health insurance segments are only $165.5 billion, which is a tiny 1.4% of the $11.47 Trillion – yes, Trillion – Healthcare industries’ total. It is unlikely to have much of an effect on the overall pricing of healthcare in America.
It’s easy to see where the obscene profits are and what is driving the increase in healthcare costs. Sadly, Obama and his Liberals are more interested in nationalizing health insurance than they are in real reform.