Congress gets bigger raise than average health care insurance companies get profit …
Stand for the truth, hold to the truth, question with confidence and boldness. The AP finally got around to it today … on a Sunday, where it’s likely to be buried:
Quick quiz: What do these enterprises have in common? Farm and construction machinery, Tupperware, the railroads, Hershey sweets, Yum food brands and Yahoo? Answer: They’re all more profitable than the health insurance industry. In the health care debate, Democrats and their allies have gone after insurance companies as rapacious profiteers making “immoral” and “obscene” returns while “the bodies pile up.”
Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent, give or take a point or two. That’s anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.
Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year, as investors were warned of a stagnant if not shrinking market for private plans.
Congress just awarded themselves a 2.6% pay increase for the 21% approval rating they have achieved — More than the average profits of health insurance companies in 2008.
The average profit margin for health insurers last year clocked in at an anemic 2.2%. What does that mean from the investor position? They would have done better to put their money into FDIC-insured savings accounts at their local bank, let alone a CD or other guaranteed investment device. A 2.2% profit margin would normally trigger a stockholder revolt.
