By Daniel Marans
The Huffington Post (3/9/17)
America’s Health Insurance Plans, the trade group for commercial health insurance companies, published an infographic this month breaking down how the industry spends every dollar it receives in premiums.
The group apparently crafted the visual aid to defend rising premiums its member companies are charging customers.
But the chart also inadvertently helps explain why commercial health insurance is a bad deal.
The graphic shows that about 80 percent of every premium dollar goes toward medical expenses ― prescription drugs, doctor visits, hospitalization and other services. Approximately 18 percent goes to administrative costs, and some 3 percent is profit. (The total is more than 100 percent because of rounding. America’s Health Insurance Plans explains how it gathered the figures for its infographic here.)
By contrast, Medicare, the largest U.S. public insurer, paid just 1.5 percent of its budget to administer traditional insurance plans for seniors and workers with severe disabilities in 2015, according to official data. The rest of Medicare’s budget went to paying doctors, hospitals, drug companies and other health care providers.
When you account for administrative costs of Medicare’s private plans, which cover some one-third of Medicare beneficiaries, Medicare’s overhead approaches 6.4 percent of its budget. …
Get Ready For Price Hikes! Trump Nominates FDA Head With Deep Ties To Drug Companies
By Toni Clarke
WASHINGTON, March 10 (Reuters) – U.S. President Donald Trump has chosen Dr. Scott Gottlieb, a conservative health policy expert with deep ties to the pharmaceutical industry, to lead the U.S. Food and Drug Administration, a White House official said on Friday.
If confirmed by the Senate, Gottlieb would be in charge of implementing Trump’s plan to dramatically cut regulations governing food, drugs, cosmetics, dietary supplements and tobacco.
Gottlieb is well known on Capitol Hill, where he has testified multiple times on hot-button health issues, including complex drug pricing matters, and is viewed favorably by drug companies and pharmaceutical investors. A former FDA official, Gottlieb also sits on the board of pharmaceutical companies.
“Thank God it’s Gottlieb,” Brian Skorney, an investment analyst at Robert W. Baird, wrote in a research note. “We view this as a favorable development for the sector.”
Gottlieb, 44, is a resident fellow at the conservative American Enterprise Institute think tank and a partner at a large venture capital fund. He is a former FDA deputy commissioner who has frequently advocated a loosening of requirements needed for approval of new medical products. …