Insurers' new reality: More for care, less profit NEW YORK (CNNMoney.com) -- Insurers were dealt a blow Thursday in their attempts to get support to push back the deadline for boosting the premium money they pay for patient care. Beginning on Jan. 1, insurance companies will have to spend 80% to 85% of the premiums they collect on medical care instead of toward their own profits and overhead costs. http://money.cnn.com/2010/10/21/news/economy/health_insurance_mlr_vote/ This spending allotment is known as the "medical loss ratio." Right now, in some states insurers don't have to meet any minimum requirements. Other states require as little as 40% of premiums to be used for medical care [...] Insurers want more time. Just last week, the NAIC sent a letter to Health and Human Services Secretary Kathleen Sebelius, in which the group said that all states may need a phase-in approach. In the letter the group said, "Insurance companies in some markets will need a transitional period to comply with the 80% MLR limit. In the absence of the transitional period, the markets of some states are likely to be "destabilized."
yes, because only republicans had control of the house, senate and executive office for the last 40 years.
Walter seems to have slept through economics at university. When you start mandating what insurance companies can do with their premiums you will find that many people simply won't want to be in the insurance business anymore. Many will leave the field. Eventually demand for insurance will outstrip the supply of insurance. Those of us who managed to stay awake during class know that means higher prices.
Beginning on Jan. 1, insurance companies will have to spend 80% to 85% of the premiums they collect on medical care instead of toward their own profits and overhead costs. ------------------------------- One problem with this ratio is for companies with high turnover, and youthful workforce, ie fast food.
31% of all premiums go just to the paperwork. This fact alone would mean insurance companies will have to double rates to keep the same profit. Thats not even looking at how much they pay to their salesmen which is typically a large portion of the premium. I dont know about health insurance, but i know with life insurance, the saleman typically gets about 85% of first years premiums per sale. I cant imagine its that far off for medical. If this thing doesnt get killed soon, its likely people will quit their $100k per year jobs to get 20k per year jobs because their take home pay will be more.
there is a lot of wage and price control built into this Health Care Debacle.... gee, when is the last time wage and price controls worked, in all of written history.... gosh, I'm searching the databanks and wow, NOT ONE F^&KING TIME IN TWO AND A HALF MILLENNIA have wage and price controls worked.. Nancy Pelosi not only doesn't need a Haloween mask, she's a complete idiot, they all are... these politicians are such TRASH!! Unbelievable TRASH!!