A wonderful post by John Goodman:
Competition from a “Public Plan”: What to Expect
- 60 Minutes: Medicare fraud is $60 billion a year
YouTube versions w/o commercials: Part 1, Part 2.- GAO: Medicaid fraud was $33 billion in 2007 alone [page 32]
- Fortune Magazine: The top 14 insurers earned $8.6 billion last year
These figures per Medicare recipient:
Number of Medicare recipients: 44.8 million … For $60 billion in annual fraud, that’s $1339 in annual fraud per Medicare recipient.
Number of Medicaid recipients: 58.7 million … For $33 billion in annual fraud, that’s $562 in annual fraud per Medicaid recipient.
Number of insured: 300.5 million. Estimate $10 billion in annual profits, that’s $33 in profit per insured person.
Note that not all insurance companies are for-profit, and 57% of those with employer-based plans are self-funded, so it’s not clear who gets the profit. Still, even if subtracting these two figured decreased the number of insured by profit-making insurers by one-third, the profit per insured person would be just $100 per year.
And remember, profit is good! In a free-market at least. It’s reward for selling what people want while keeping costs low. Yet, insurance company profits would be lower if politicians did not shield them from competition.
See also:Government Health Care Awash in Waste and this post on insurance company profits.
