Health insurance companies have never been overly popular but they are currently being abused even more than usual as liberals try to rally support for their reform plans by scapegoating them. Here is Kevin Drum:
Health insurance is a weird industry. Healthcare itself is provided by doctors, nurses, hospitals, pharmaceutical companies, hospices, and device makers. Insurance companies do none of this. They don't do research, they don't perform surgeries, they don't change bedpans, and they don't make diagnoses. They're just middlemen. All they do is pay the bills after marking them up 30%. They don't do anything at all to make healthcare better or more efficient.
However the claim that insurance companies just mark the bills up 30% is false. They first negotiate the best price they can get from the doctor or other provider. This is generally better than an individual could get. For example a couple of years ago I had hernia repair surgery. The surgeon's list price was $12916.00 but the insurance company price was $363.38 which is a 97% discount. I don't mind paying a 30% markup to get a 97% discount. Of course this is an extreme example but insurance companies routinely get prices which are unavailable to individuals. In fact this is a big part of the reason it is risky to be uninsured, if you need medical care you will be gouged.
This sort of dubious argument from the left does not increase my confidence in their health reform plans. Perhaps it is fortunate that they may not pass.
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