Health care does not need to be private with a 40% overhead
Where do you get your information? No insurer would survive with 40% overhead.
Here are some facts, publicly traded Wellpoint, one of the 2 largest private for profit health insurers.
Benefit expense
44,926.9 47,119.8 (2,192.9 ) (5 ) Selling, general and administrative expense:
Selling expense
1,610.3 1,685.5 (75.2 ) (4 ) General and administrative expense
7,229.1 7,424.9 (195.8 ) (3 ) Total selling, general and administrative expense
8,839.4 9,110.4 (271.0 ) (3 ) Cost of drugs
— 419.0 (419.0 ) (100 ) Interest expense
418.9 447.4 (28.5 ) (6 ) Amortization of other intangible assets
241.7 266.0 (24.3 ) (9 ) Impairment of goodwill and other intangible assets
21.1 262.5 (241.4 ) (92 ) Total expenses
54,448.0 57,625.1 (3,177.1 ) (6 ) Income before income tax expense
4,353.8 7,403.0 (3,049.2 ) (41 ) Income tax expense
1,466.7 2,657.1 (1,190.4 ) (45 ) Net income
$ 2,887.1 $ 4,745.9 $ (1,858.8 ) (39 )
Total selling general and administrative expenses are about 15%. I have looked at the financials of other organizations which have slightly lower admin costs.
Medicaid overhead may seem low to the govt, but it pushes a lot of extra admin costs onto the providers. |
