Drug addicts talk about having to “hit bottom” before they finally realize they have to do something about their problem. Are we about to see the U.S. healthcare system hit bottom?
Today, UnitedHealth Group, the nation’s largest health insurer, cut its earnings forecast and said it would slash 4,000 jobs. Bloomberg reports:
In the Medicare business for the elderly, for which UnitedHealth is the market leader, gross margins declined in plans that provide prescription drugs and specialized coverage for people with chronic diseases, the company said.
The company forecast that its overall medical loss ratio, the percentage of premium revenue spent on medical care, would increase to 82.5 percent for the full year, up from its earlier prediction of 81.3 percent.
How horrible — that premiums would actually go toward paying for prescription drug insurance (medical care), rather than in some fat cats’ pockets!
The irony here is that Congress designed the Medicare prescription drug benefit precisely to line the pockets of pharmaceutical and insurance companies with government dollars — and these companies still aren’t making enough money to satisfy Wall Street.
How come? Well, if you want the ant’s eye view, it’s this, according to an analyst:
UnitedHealth no longer offers competitive, affordable products to the marketplace that people want to buy, especially with all their customer service, claims payment and provider relationship issues…
But if you want the bird’s eye view, it’s that the system is broken and is getting more broken every day.
Pretty soon, we’ll be at a point where ALL of us — even the pharma and health insurance industries — are miserable in the current “system.” And that’s when we’ll hit bottom.