itfitzme
VIP Member
@ Trajan
BlueCross/BlueShield, and the rest of the insurance companies, accepted a not-for-profit system with ACA. They are capped at a 15% of revenue for running things model. If you have AAA, you get a check at the end of the year. Any extra revenue, from premiums, that exceeds expenses is returned to the customer. Same now with the medical insurance companies. BlueCross/BlueShield had it in their advertisements this last year, that they were sending back checks to customers. These guys know what they are doing in terms of estimating costs and variability. The premiums are a bit higher then they expect, $50, and they send back $5.
Honestly, the last thing I expect is for the medical markets to be saying, "Oh damn, we didn't charge enough." And, with the insurance companies being the channel for the funds, they are the major market force for pricing. It's always a negotiation, of course. But if the insurance companies are incentivized to keep costs down (which they naturally are), and are free from the profit motive, (they still get paid well), that has to go along ways to getting the market to be efficient as it should be.
Frankly, the biggest problem is that the demand for services is so more like infinite than any other market. We need only so much fuel. We eat only so much. Housing is in a bit of a glut (incl rentals). But there is not shortage of demand for medical. Eventually, we are all looking for whatever it takes to get another year out of it. That is what I see as being the thing, people whining because they want more service and can't get it. The $ will adjust. It is almost magical how the money supply adjusts (until the banks stop lending and the whole thing tanks, but that is another problem).
The problem is that we don't have a measure of "utility" and $ really is not a fixed thing. The $1 doesn't have a fixed underlying value, then the price can change to. It really annoys me.
What are we saying, that the insurance company will contract for $40 in premiums and have $45 in salaries to pay? Nah..... They will contract for $50 in premiums and end up with $40 in salaries, then give back $5. That is how it is structured.
Don't get me wrong, I was annoyed last night by the inability to match labor hours of medical to labor hours of the rest of the system. But we really don't have to. We cannot purchase what has not been produced. It is a huge economy, with 140 million some odd people working. Things adjust. At a macro level, it isn't constrained like it is with our checkbook. I don't know if you know what I mean by "four equations with six unknowns", or "degrees of freedom"? The economy has wiggle room, actually that is the problem with it, to much wiggle room. It is actually under constrained which is why we can have excessive inflation and deflation.
BlueCross/BlueShield, and the rest of the insurance companies, accepted a not-for-profit system with ACA. They are capped at a 15% of revenue for running things model. If you have AAA, you get a check at the end of the year. Any extra revenue, from premiums, that exceeds expenses is returned to the customer. Same now with the medical insurance companies. BlueCross/BlueShield had it in their advertisements this last year, that they were sending back checks to customers. These guys know what they are doing in terms of estimating costs and variability. The premiums are a bit higher then they expect, $50, and they send back $5.
Honestly, the last thing I expect is for the medical markets to be saying, "Oh damn, we didn't charge enough." And, with the insurance companies being the channel for the funds, they are the major market force for pricing. It's always a negotiation, of course. But if the insurance companies are incentivized to keep costs down (which they naturally are), and are free from the profit motive, (they still get paid well), that has to go along ways to getting the market to be efficient as it should be.
Frankly, the biggest problem is that the demand for services is so more like infinite than any other market. We need only so much fuel. We eat only so much. Housing is in a bit of a glut (incl rentals). But there is not shortage of demand for medical. Eventually, we are all looking for whatever it takes to get another year out of it. That is what I see as being the thing, people whining because they want more service and can't get it. The $ will adjust. It is almost magical how the money supply adjusts (until the banks stop lending and the whole thing tanks, but that is another problem).
The problem is that we don't have a measure of "utility" and $ really is not a fixed thing. The $1 doesn't have a fixed underlying value, then the price can change to. It really annoys me.
What are we saying, that the insurance company will contract for $40 in premiums and have $45 in salaries to pay? Nah..... They will contract for $50 in premiums and end up with $40 in salaries, then give back $5. That is how it is structured.
Don't get me wrong, I was annoyed last night by the inability to match labor hours of medical to labor hours of the rest of the system. But we really don't have to. We cannot purchase what has not been produced. It is a huge economy, with 140 million some odd people working. Things adjust. At a macro level, it isn't constrained like it is with our checkbook. I don't know if you know what I mean by "four equations with six unknowns", or "degrees of freedom"? The economy has wiggle room, actually that is the problem with it, to much wiggle room. It is actually under constrained which is why we can have excessive inflation and deflation.
