Monday, February 8, 2010

Blue Cross Plunders Californians.

Blue Cross in California has changed its name to Anthem. Maybe they are trying to disguise their monopoly position in health insurance across the country. We have anti trust laws in this country which are supposed to prevent businesses from becoming monopolies, and/or to break up businesses that acquire that power. Unfortunately, those laws have not been enforced for many decades. The reason those laws are not enforced is because the businesses which have monopoly control pay enormous bribes to our politicians.

What is a monopoly? The term "monopoly" derives from the Greek words "monos" (which means alone, or single) and "polein" (which means to sell). Our laws against monopoly are based on the understanding that when one or a very few businesses have enough control over an industry that they can significantly set the terms for sale, that is bad for society. For example, if one company (i.e. Monsanto) takes all the corn seed and genetically modifies it, and farmers around the country who want to grow corn only can buy from Monsanto because there is no other company that sells corn seed, then Monsanto can charge however much they want. Under a monopoly system, one business either buys up other competitors or puts them out of business, so the public is left with no real choices.

Despite the Republicans orgasms over the doctrine of "free markets," the fact is we have no free markets in this country. We have monopoly control of most fields of business. In TV, for example, you cannot get reception without paying either a dish or cable company, and most cities sign a contract with a cable company giving them the exclusive right to sell cable TV in the city. The citizens have no say in it, have no choice, there is no competition, and there is nothing to hold down the rather astonishing rate increases. Same for garbage collection: monopoly given by contract with the cities.

The concept of a "free" market includes two parts. First, any business or person is free to compete for the business. Second, consumers are free to choose from among the various competitors. Neither is true for the most part in this country.

If you have any real questions about that, look at Microsoft. Not only do they have a monopoly control in the operating system market, but they bundled their operating system (Windows) with their word processing (Word), sold it as a package, had computer dealers install the two together, so that consumers never had a choice in what operating system they wanted, or what type of word processing system they wanted. Of course that's the least of Microsoft's sins, but it's a big one.

In healthcare, we have a lobby which prevents people from going to medical school or becoming doctors. That's right: they restrict the amount of competition to allow them to keep their prices astronomically obscenely high. And doctors use their obscenely high salaries to buy lobbyists to buy politicians and prevent any law being passed which would give citizens a choice for their healthcare.

The doctors also bribe politicians to pass laws which are euphemistically called "tort reform," but which really are laws which provide that even when doctors screw up, even if they kill people, even when they are drunks and drug addicts and incompetent, they still cannot be held liable for their actions by a court lawsuit and decision of the jury. Obama has already given that one to the doctors, assuring them that he supports "tort reform." Or, as I call it, "A License to Kill."

Double the number of doctors and the prices would fall. We should import doctors by the gross from India, China, Pakistan, any country with good medical schools; offer each of them a salary of $60,000/year for 10 years, plus the right to go into private practice and become a citizen at the end of 10 years. During the 10-year period they would work in clinics, local medical groups, medicare, and locally-owned hospitals. That would easily and economically solve most of the problems with our healthcare industry. But nobody in government will help us. If we had dead people piled up in the streets because of a lack of healthcare, the politicians would just step over our bodies on the way to their fundraisers.

Instead, we have privately-owned hospitals that charge insane amounts, privately-run medical groups that charge insane amounts, and a large percentage of the population that cannot afford basic healthcare. It is a disgrace.

There have been mumbles from the Democrats about "health care reform," but most of the proposed changes will do nothing to help most Americans. Nothing. The main reason the Democrats want to pass the "healthcare reform bill" is so that when they campaign for election this year and in 2012, and probably for decades to come, they can put in their campaign advertisements: vote for the party that passed real healthcare reform. That's the only reason.

Well, there's also the fact that most of the Democratic politicians will get lots of money in kick-backs and bribes if this "reform" is passed. It is estimated that by the government forcing all Americans to buy health insurance, the health insurance, doctors, drug companies and hospitals will get an additional $100 Billion to $200 Billion in revenue every year. That will pay for a lot of bribes and kick-backs to the politicians. That's also the main reason the Republicans oppose this bill: if it passes, it will mean lots more money into the campaign coffers of the Democrats.

Blue Cross has changed its name in California to Anthem. Don't ask. It's probably designed to disguise the fact that just one health insurance company has a monopoly in much of the country. In any event, for people who are not part of group policies, Blue Cross is raising the monthly premiums by 39%, and they also are threatening to raise the premiums again anytime they want, possibly within the next year. No price controls there. No competition. No good alternatives. A lot more people are going to lose their health insurance because of the greedy pigs running this program.

So here's the question: will anybody do anything to help? It seems obvious to me what should happen: every single person who is not part of a group policy should be allowed to immediately buy into Medicare at a non-profit price. It would probably be half what Blue Cross is charging. It would be good for Medicare because it would bring in a group of younger, and usually healthier people, who would be paying their own way. It would be good for the rest of the country because it would show that somebody in our government is willing to help people in this country when they are being threatened with death, an early death, a needless and unnecessary death, caused by the greedy and unconscionable insiders who run Blue Cross.

So what do you want, Obama. Help the people or let them die? Nobody wants speeches. Nobody wants to be told they should just "hope" they don't get sick. People's lives are on the line. Will you help them?

From the Los Angeles Times:

"Anthem Blue Cross dramatically raising rates for Californians with individual health policies. Policyholders are incensed over rate hikes of as much as 39%, which they say come on top of similar increases last year. State insurance regulators say they'll investigate."

By Duke Helfand (2/4/10)

"California's largest for-profit health insurer is moving to dramatically raise rates for customers with individual policies, setting off a furor among policyholders and prompting state insurance regulators to investigate."

"Anthem Blue Cross is telling many of its approximately 800,000 customers who buy individual coverage -- people not covered by group rates -- that its prices will go up March 1 and may be adjusted "more frequently" than its typical yearly increases."

"The insurer declined to say how high it is increasing rates. But brokers who sell these policies say they are fielding numerous calls from customers incensed over premium increases of 30% to 39%, saying they come on the heels of similar jumps last year."

"'I've never seen anything like this,' said Mark Weiss, 63, a Century City podiatrist whose Anthem policy for himself and his wife will rise 35%. The couple's annual insurance bill will jump to $27,336 from $20,184."

"'I think it's just unconscionable,' said Weiss, a member of Blue Cross for 30 years." ....

"Individual policies are often the only option for those who are uninsured, self-employed or do not receive health coverage through employers."

"....Mary Feller of San Rafael learned that the rate for herself and her husband will jump 39%, or $465 a month, driving the couple's annual premium to $19,896 from $14,316."

"Feller, 56, said the premium for her 26-year-old daughter also will rise 38%, costing the family an additional $1,572 a year."

The L.A. Times article also notes that Blue Cross is owned by WellPoint, Inc., which makes obscene profits, increasing their profits by a multiple of 8 during the last 3 months of 2009 alone. The article also notes that people who buy individual policies often have no options because any other insurance company in the state will require them to have a full medical screening, and to make their medical records available, and the company will just reject them outright if they have any preexisting conditions or any health problems.

This is a monopoly. Why doesn't the government enforce the anti-trust laws by filing suit to break them up. And help the Californians who are being crucified by Blue Cross.,0,3002094.story

So far, the only reaction from the state has been mealy-mouthed and meaningless, saying only that they will "investigate" to make sure Blue Cross pays out at least 70% of the premiums received for healthcare. They should save the taxpayer money. Blue Cross does meet the 70% requirement. The problem is that by charging such obscene amounts, they can essentially make a 30% profit (Medicare has a 3% management/overhead cost, and private insurance could do the same). Blue Cross certainly will claim their profit is less than 30%, but that's just because they are paying insiders tens of millions of dollars.

So what is the response from the federal government? Not much.

Health and Human Services' Sebelius seeks justification for Anthem health insurance rate hike

On Monday February 8, 2010, 12:27 pm

"The Obama administration is asking Anthem Blue Cross to justify its plans to raise health insurance premiums by as much as 39 percent for customers in California."

"Health and Human Services Secretary Kathleen Sebelius sent a letter to the company's president on Monday calling the planned increases extraordinary and difficult to understand. She wrote that the company has an obligation to provided a detailed justification for the rate hikes to the public." ....

This is about the type of response I would expect from the federal government if Bush and Cheney were still in charge. They'll "look into it." Once again, thanks for nothing, Democrats.


  1. Thanks for the comments. Interesting read. I live in Georgia and I dropped my Blue Cross and Blue Shield and went with another copmpany called Consumers Life Insurance Company.

    I am a 40 year old male, healthy, never been in the hospital and in good condition with no high blood pressure and I excercise frequently. I could not afford Blue Cross and Blue shields hikes in prices 2 years ago.

    I work full time and own my own business. I am what america is supposed to be about.....capitalism at its finest. A small business owner hoping to do better for his kids. Why am I discouraged and mad about our system? I think you answered most of it. Thank you.

    FunBob from Georgia.

  2. I guess the thing is that "middle class" people don't expect to be denied something as basic as healthcare. Just like they don't expect to be thrown out of their homes, lose their jobs, denied pensions or the likely ability to ever retire, and to have college be so expensive that their kids could never afford to go.

    The basic social contract has been breached, and many of us are just stunned and reeling.

    I think during the first Great Depression, most people thought it was "just economics," and didn't really understand that a few wealthy criminals had set the whole thing in place, that some people got very rich while everybody else got poor.

    Today many of us know these economic problems were caused by some rich people, and we cannot believe our government does nothing to punish those who are responsible.

    Such as, for example, let people buy into a non-profit system if they choose, which would force the health industry to lower their prices to become competitive. Tax the wall street bonuses at 90%, and you would stop the looting.

    So the greed of the monopoly business owners is not surprising, but the refusal of both parties of our government to do anything to help us -- that part is shocking.

    Stay healthy, FunBob from Georgia. And thanks for the comment.