The core issue regarding government issued health care insurance versus privately issued health care insurance is not being addressed.
It was the free market system of competition that initially enticed health insurance companies to lure customers away from competitors with added benefits. The government did not force the insurance companies to add benefits to their coverage.
These added coverages resulted in record-breaking enrollment, record-breaking profits, and record-breaking overhead for health insurance companies. The only way available for these insurance companies to sustain this model was for them to factor in yearly rate increases.
The problem that developed was the lack of the personal income of those purchasing insurance keeping up with the annual rate increases the insurance companies based their entire operating model on.
There is no way possible for the health insurance companies to restructure their current operating model in a way that would lower premiums to their customers. Even plans that offer less coverage and higher deductibles go up every year.
The unavoidable fact is that the health insurance business has become a classic example of a ?vicious cycle.? They charge too much and yet they can?t exist without perpetually raising the cost of their product.
At its core, this issue is not about government health care insurance versus privately issued health insurance. This is an issue of a bad business model being allowed to become the only game in town.
George Corneliussen
Montgomery
Posted in: business, economy, government, Greater Cincinnati, healthcare, National, Northern Kentucky, Ohio
Tags: big business, coverage, health insurance, Montgomery
Source: http://cincinnati.com/blogs/letters/2012/07/12/health-insurance-operating-under-bad-business-model/
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