How much profit do they make? According to a recent study by PricewaterhouseCoopers, just 3 cents on the dollar. This is pretty small compared to those in other industries.
The profits would be less if there were more competition. That is, if the tax code didn’t favor employer-provided insurance, which makes it difficult for consumers to change providers and encourages people to buy more insurance than they otherwise would. It also doesn’t help that mandated benefits regulations force people to pay for coverage they may not want, like infertility treatment, treatment for alcohol abuse, etc.
(Via John Goodman)
