While I flag more items from that resource in the following post, this is a sufficient "crown jewel" to flag separately.
Please read it and see how much you can get from the links it provides. Please have a look at the "About the Health Affairs Blog," post, here.
This excerpt from the opening of the item is for giving a flavor of the argument - one of the most comprehensive I have seen:
Why A Public Health Insurance Option Is Essential
September 17th, 2009
by David Balto
The biggest flashpoint in the ongoing debate over the future of the U.S. health system is whether Congress should change the balance of power that now favors the private health insurance industry. Opponents of the idea argue that a public health insurance plan competing with private insurers would lead to inferior health care, harm providers, and drive the multibillion dollar for-profit health plans out of the market. Fears of Armageddon are without merit and inconsistent with reality.
The U.S. has a health care crisis created by the private insurance companies that some are so worried about protecting. Health care costs are out of control, threatening the viability of American businesses and the hopes of millions of American families. More than 47 million Americans are uninsured, and according to Consumer Reports, as many as 70 million more have insurance that doesn’t really protect them. In the past six years alone, health insurance premiums have increased by more than 87 percent, rising four times faster than the average American’s wages, according to a Kaiser Family Foundation report. American families in the lowest income group spend 20 percent of household income on health insurance. Health care costs are a substantial cause of three of five personal bankruptcies.
The Broken Health Insurance Market
While opponents of a public insurance plan proclaim their fealty to consumer choice and honest competition, any who dare to take the economic temperature of the existing health insurance marketplace would find few markets so clearly lacking in them. Health insurance markets are extraordinarily consolidated at the state and local level, according to the American Medical Association. In 39 states two insurers control at least 50 percent of the market, and in nine states a single firm controls at least 75 percent of the market, the AMA found. In 2007 the group reported that almost 95 percent of more than 300 metropolitan areas are highly concentrated.
What has been the result of this lack of competition? Rapidly increasing premiums, declining service and escalating profits. As noted above, health insurance premiums have almost doubled in the past seven years, while the number of uninsured has escalated. Without significant reform, this situation will only worsen: premiums are expected to rise to nearly a quarter of the median family’s income by 2020.
Consumers have suffered while the for-profit insurers have had record profits. From 2000 to 2007, the 10 largest publicly-traded health insurance companies increased their profits 428 percent, from $2.4 billion to $12.9 billion annually. In addition to profit, the seven largest for-profit insurers boosted their earnings per share by repurchasing $52.4 billion of their own stock from 2003 to 2008—money that could have been spent on improving the health care system or cutting premium rates. These profit margins have come directly out of customers’ pockets in the form of escalating premiums and worsening service. The Congressional Budget Office found that overhead and profit account for 11 percent, on average, of private insurer’s premium revenue.
Moreover, one cannot expect that normal market forces will “correct” the problems in these markets. In a competitive market, one could expect that entry would occur when dominant firms exercise their market power. But in health insurance there has been little or no meaningful entry in the past decade into markets that are highly concentrated. The entry barriers to these markets are substantial: employers are reluctant to switch plans and information is not transparent making it difficult to compare plan offerings. The time and cost to switch plans is substantial. Moreover, dominant insurers make entry all but impossible by locking up providers through most favored nations arrangements or all products clauses that make it difficult for them to facilitate entry by making a more attractive deal with a new entrant.
That is high quality writing!
Read it all.
Send the link to your Congressional Rep. (unless you, like me, have Bachmann or Kline as Rep., where sending it there would be aiming upwind). Particularly send it if you live in District Five, Ellison's district.
Again, this link.