COLUMN: More to insurance story

Re: Sholeh Patrick's column "Insurers reaping record profits" on May 19. It sounds pretty simple... "Remove the profit element, do nothing more, and we see meaningful change without sacrificing a black bottom line." A little research suggests otherwise.

A study from international consultancy PricewaterhouseCoopers calculated insurance industry profit at barely three percent. How big an impact would that have on your premiums? Not much. I don't think we can "do nothing more" and completely solve the cost issue. As for the record profits, the cost of health care is going up, hence the cost of health insurance goes up as well. Three percent of a bigger number equals a bigger number, hence record profits.

Actually, nonprofit insurance companies already exist. For example Blue Shield of California is a not-for-profit company, as is Kaiser Permanente. They compete with for-profit companies such as Anthem Blue Cross of California (Wellpoint), Aetna, United Healthcare and others. If the nonprofits were so much less expensive for comparable benefits they would be the only game in town. Blue Cross and others compete not only by cost but by offering plans specifically designed for certain types of buyers. No one-plan-fits-all. They can also contract with doctors in rural areas where Kaiser does not reach, and provide nationwide coverage.

Medicare is another nonprofit insurer, the largest one out there. Yet Medicare has its own cost problems. No profit there, but major cost problems.

Clearly, taking the profit out of the equation and doing nothing more is not the answer even if it sounds pretty simple. It's way more complicated than that. More on that later.

TIM GUTZKE

Member, North Idaho Association of Health Underwriters

Post Falls