The proper role of private insurance companies in a health reform system

[jmowreader]

Insurance companies are at their hearts investment companies. They collect premiums, invest them in a range of vehicles--some they can get out of quickly, others that have higher returns, so as to maximize ROI--pay benefits to people who make claims, and pocket the remainder.

The function of the government is to serve the commonweal. It's not an investment service.

Assume private healthcare companies are to be given a seat at the table here. Their function should be to serve as investment managers: give them a piece of the premiums paid into the public system, tell them they are contractually obligated to return x number of dollars to the government on a certain date, and let them go do it. If the fuckers have to stand on the street corner selling candy bars to make their mandated contribution, that's what they'll do. OTOH, if their investment income exceeds their mandated return they get to keep the surplus.

Advantages: it removes the responsibility of paying claims from the insurance companies, meaning they would no longer be able to deny care. It would encourage them to seek out safe investments because on date certain they will have to wire back a stated number of dollars and no less--they can't say "oh, all the money we deposited on account with Bernie Madoff is gone so we can't make our payment." Nope, if you were stupid enough to fall for a Ponzi scheme you better sell your corporate plane right now because you're on the hook for $23 million and we need it now.

Disadvantages: Glenn Beck would call it socialistic, but he does that anyway.