Another Reason Health Care Costs So Damn Much

Your “non-profit” blues plan.

If you’re insured by a Blue Cross plan you know the company line:  “We’re non-profit and reinvest all of the money we make in our members.”

Yeah, right.

The Curmudgeon has written about this before:  instead of lowering your premiums, Blue Cross plans hold onto their profits – excuse us, “excess revenue over expenses” – in vast reserves that far outstrip how much money they need, from an actuarial perspective, to ensure their ability to pay their customers’ claims even in the event of an economic downturn.

Now, though, they’ve stumbled upon a new source of windfall profits – excuse us, “excess revenue over expenses.”  That source?  The Trump/Republican Congress tax cuts.

According to the online publication HealthPayer Intelligence – yes, The Curmudgeon knows, he REALLY needs to get out more – your friendly Blues plan is rolling in tax savings.

Fifteen BCBS companies reported a tax benefit of nearly $4.7 billion before accounting for net changes in tax assets. Only two BCBS payers had tax losses after accounting for changes in the TCJA.

And this figure is for 2017 alone.  These windfall profits will now continue annually.

So The Curmudgeon wonders:  are these Blues plans lowering their premiums in the wake of this vast infusion of unearned cash?

Of course they’re not.

Because in the end, they like to put a good guy sheen on it but your local non-profit Blues plan is every bit as rapacious as the for-profit insurers that don’t even bother with the pretext that they give a damn about their customers.

And this is yet another reason why health care costs so damn much in this country.

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  • By Penny-Wise, Pound-Foolish | The Four-Eyed Curmudgeon on December 3, 2018 at 6:06 am

    […] So the guy in Georgia turned to his health insurer for help – one of those Blue Cross plans The Curmudgeon has written about in the past.  (See here,here,here,here, and here.) […]

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