Health Insurance Profits As Medicaid Struggles
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February 17, 2010
CHARLESTON, W.Va. - A state legislator who is one of the people charged with holding together West Virginia's Medicaid budget says he is furious about the $12 billion in profits reported by the country's five largest health insurers. A recent study based on company financial reports found big health insurance companies' profits rose by more than 50 percent last year.
Wayne County Delegate Don Perdue chairs the House Health and Human Resources Committee, and he says multi-billion- dollar profits are beyond belief at a time when West Virginia is struggling to use Medicaid to cover people who have lost coverage.
"For that amount of money, how many people who are not insured could we have insured? How many children under S-CHIPs? How many state governments who are having trouble funding their health programs could we have supplied funding to?"
Perdue points to another finding in the study, that insurance profits rose while the companies were covering 2.7 million fewer people across the country.
"The greater number of uninsured you have, the greater the increase in the profitability of the health insurance industry. There's a vested interest in making sure that the status quo is maintained. If you're going to sustain that level of profitability, you don't want to see anything change."
West Virginia lawmakers are fighting to close shortfalls in health care budgets, relying in part on federal stimulus funds to bridge the gap.
The companies defended their profits, saying they were the result of the recession. Perdue says he doesn't buy the argument that insurance company profits should go up when everyone else is hurting.
U.S. Senator Jay Rockefeller of West Virginia, a sharp critic of the health insurance industry, will address a rally on health care, jobs and the economy at the state capitol today at 11 a.m. A full copy of the report on insurance industry profits can be found at: blog.healthcareforamericanow.org