Health Insurance in the US

Wednesday morning the CEO of United Healthcare was gunned down in a targeted attack in Manhattan. At the same time Blue Cross Blue shield was trying to limit how much they would pay for anesthesia by saying that they would not pay for it if a surgery went over a certain length of time.

Right now across the internet people are actually celebrating the murder of the United Healthcare CEO, and the backlash in response to BCBS’s attempt to change how they pay for anesthesia has been so fierce that they have already announced that they will not be going through with it.

Let’s start by discussing the CEO and why so many people are celebrating his demise and we will see how the actions of BCBS play a factor in that. Our healthcare system in the US is incredibly broken, no other country spends so much on health care per capita and gets so little in return as the US. In 2022 the US spent an average of $12,555 dollars per person on healthcare, this is over $4,500 more per person than the next highest country which is Switzerland at $8,049¹. And what do we get in return for this? in 2022 Switzerland had a life of 83.5 years, vs 77.5 in the US. Here is a comparison with several other countries²:

But why is that? The reason is that unlike the other countries on the list the US has a private for profit healthcare system, for profit incentivizes charging as much as you can get away with to maximize those profits. Another way to maximize profits is to cut costs as much as possible and that is where we wrap back to the two events I started this post talking about. United Healthcare is the largest health insurance company in the US covering roughly 50 million people, and it is estimated that they deny almost 1/3 of the claims that are submitted to it³. A class action lawsuit that it is facing alleges that it uses a computer algorithm with a 90% error rate to base many of these denials on, and they are relying on the fact that only 0.2% of denials are appealed⁴. A recent report from the Senate Subcommittee on Investigations alleges that United Healthcare used automation technologies, at least one of which they knew would increase the denial rate⁵. And, just this year six different healthcare systems went out of network with United because of how many claims that they denied⁶. With BCBS they have thankfully announce that they are rolling back the change⁷, but this isn’t even the first time in the past 12 months that they have tried this⁸. Make no mistake, healthcare systems have a litany of issues as well, but that is for a different post.

All of these denials impact patients dramatically. Personally, about ten years ago I had to switch psychiatrists because my employer switched to United Healthcare and my psychiatrist at the time, who was awesome, did not accept them because of how often claims were denied. These denials, especially the ones in error, impact patient quality of life, and outcomes. In extreme cases they can hurt or even kill patients when needed care is denied or delayed. While I am not saying that violence is the answer, I can easily see how the treatment of patients by health insurance companies could lead someone to doing this.

I think that the solution to this is easy and it it to eliminate profit from healthcare. Doing this would lower costs tremendously, United Healthcare, for instance brought in $22 billion in 2023 profits⁹. Imagine if instead of profits that money was used to pay claims. Imagine if healthcare systems did not include profit in their pricing and the pricing instead reflected actual expenses. Our healthcare system is broken in this country because it values shareholders and investors over patients, and it will remain broken until that changes.

1. https://www.healthsystemtracker.org/chart-collection/u-s-life-expectancy-compare-countries/
2. https://www.healthsystemtracker.org/chart-collection/u-s-life-expectancy-compare-countries/
3. https://www.forbes.com/sites/amyfeldman/2024/12/05/unitedhealthcare-denies-more-claims-than-other-insurers—angering-patients-and-health-systems/
4. https://www.statnews.com/2023/11/14/unitedhealth-class-action-lawsuit-algorithm-medicare-advantage/
5. https://www.hsgac.senate.gov/wp-content/uploads/2024.10.17-PSI-Majority-Staff-Report-on-Medicare-Advantage.pdf
6. https://www.beckershospitalreview.com/finance/15-health-systems-dropping-medicare-advantage-plans-2024.html
7. https://www.npr.org/2024/12/05/nx-s1-5217617/blue-cross-blue-shield-anesthesia-anthem
8. https://www.asahq.org/advocacy-and-asapac/fda-and-washington-alerts/washington-alerts/2024/01/victory-bcbsma-rolls-back-restrictive-anesthesia-policy
9. https://www.forbes.com/sites/brucejapsen/2024/01/12/unitedhealth-group-profits-hit-23-billion-in-2023/