Daily News Updates - Health Insurance News

American Health insurance System 201, Pt.3 – The Fed is also a ‘big time’ player.

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Another complicating factor is the fact that the federal government is already a ‘big time’ player in the health insurance industry. The Medicaid program already has a very large enrollment comprising millions of people, picking up some of the pieces that the private health insurance industry doesn’t want. Those would be people like the elderly and the disabled. To be sure, its not a pristine mixture, the private health insurance industry is enjoying the friendly environment of administrating much of it and are being paid handsomely with our tax payer moneys. They only have minimal risk. Left to only the free market forces, though, these people would be destitute. The private health insurance companies would then cover “only the rich could afford health insurance, and then only if they were in the lowest risk categories,” as explained by Mr. Gallington.

Even though Medicare doesn’t claim to be perfect, they are still many times more efficient (about 3% overhead) then the private health insurance industry (which is closer to between 30-40% overhead). As far as medical care over-abuse, both systems have a lot of work to be done. For example, the medications administered with Medicare, Part “D” cost the government (and taxpayers) about 30% more then they are charged for the other Medicare programs.

To boot, it is estimated that, perhaps 30% to 40% of the treatment paid for by the private health insurance industry is unnecessary, wasteful and even dangerous. In any case, Medicare is a big ‘player’ in the health insurance industry.

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