PricewaterhouseCoopers is the world’s largest accounting firm. It’s gross sales in 2008 were about $28 million. The company employees more than 155,000 people and generates millions of dollars a year to lobby members of Congress on behalf of their clients.

According to OpenSecrets.Org, some of the industries that have hired PricewaterhouseCoopers to push their agenda in Washington, DC include energy, health care, pharmaceutical, insurance and financial sectors.

In 2005, PricewaterhouseCoopers racked in more $16 million in lobbying fees. In 2006, it was down to just under $6.7 million. And in 2007 and 2008 PwC made about $5.5 million each year lobbying.

Yesterday, representing their health industry clients the firm released a report claiming that if the Senate Finance Committee bill becomes law the cost of health care will skyrocket.

According the PwC “Report on Costs,” health insurance premiums will increase by 111 percent in 10 years if the Baucus bill is left unchanged.

At issue are four provisions, which the reports says, if enacted “could increase private health insurance premiums about the levels projected under current law.”

The provisions are:
1. Insurance market reforms and consumer protections that would raise health insurance premiums for individuals and families if the reforms are not coupled with an effective coverage requirement.
2. An excise tax on employer-sponsored high value health plans (or “Cadillac plans”) that in a few years could also raise premiums for some moderate value plans.
3. Cuts in payment rates in public programs that could increase cost shifting to private sector businesses and consumers. These changes are expected to more than offset the potential reduction in cost shifting resulting from providing coverage to the uninsured.
4. New taxes on health sector entities that are likely to be passed through to consumers.

In other words, the cost of insuring the uninsured and tax increases will be passed directly to consumers. That’s how the free market works. Without a viable public health care system that’s focused on keeping costs low, private insurers will simply push the cost of health care reform onto the backs of existing policy holders.

The PricewaterhouseCoopers report is a clear signal by the health industry that they will not sacrifice profit to reduce the cost of providing health care for everyone. Private insurance companies have no desire to cover the uninsured, because many of the people who don’t have health insurance have already been denied coverage for a pre-existing condition.

Therefore, only a public health care plan can provide adequate care to those lacking access to proper health care – the free market will not suffice because there’s no money in covering people who already have cancer, back problems or diabetes.

Read the PricewaterhouseCoopers “Report on Costs” of health care reform
OpenSecrets.Org data on PricewaterhouseCoopers lobbying income and clients
PricewaterhouseCoopers Corporate Web site

Last night the Senate Finance Committee worked until 2 a.m. this morning to vote on all of the remaining amendments to the Baucus bill. Unfortunately, aside from some minor tweaking, the bill still looks like a huge pile of steaming horse manure.

Almost everyone will be forced to purchase health insurance – a boon for the insurance companies. Some poor people will be exempt from the individual mandate, but that just means they’ll still not have health care. The public option is nowhere in sight.

It’s too bad the Senate is such a worthless governing body – apparently filled with lapdogs for insurance companies, Big Pharma and hospitals. I’m not surprised. It’s obvious that the politicians have successfully rigged our political system so that they can remain in power while doing nothing for us and everything for their real constituents – corporations and the Elite. Oh well, did we really think anything good would come from Congress? Nope.

I keep saying it, but now is the time for a real revolution. We need a real government run by the people. Let’s organize.

Read the New York Times story on the latest Baucus bill developments

Here’s more proof that insurance companies are in fact evil, disgusting and should be banned from doing business in the US.

The Huffington Post has a story that they picked up from the St. Petersburg Times about a mother how who went blind to save her two daughters. The each have a disease called Stickler syndrome. Without treatment the young girls will go blind, yet the insurance company has decided that they’ve received enough treatment and should go blind.

Check out the Huffington Post story and video

I can think of nothing more disgusting than an insurance company. They make Pol Pot look like a humanitarian and he murdered about 2 million people. How many have the insurance industry killed just this year? 30,000? 40,000?

It’s hard to see the forest for the trees when trying to determine what the heck is going on with health care and health care reform. The most easiest way to figure out what’s happening is to follow the money. When looking at the health insurance industry, all you have to look at what investors look at – the medical loss ratio.

Former insurance industry executive Wendell Potter explained the medical loss ratio to Bill Moyers. “It’s a measure that tells investors or anyone else how much of a premium dollar is used by the insurance company to actually pay medical claims.”

Bank in the early ’90s, Potter said, “Ninety-five cents out of every dollar … was used by the insurance companies to pay claims. Last year, it was down just slightly above 80 percent.”

For every penny an insurance company can trim from it’s medical loss ratio is a penny of profit, but we’re not talking about pennies, we’re talking about millions and millions of dollars. Just last April, Aetna stocks fell 10 percent after reporting strong profits. The problem was Aetna’s medical loss ratio was at 81.7 percent, rather than the 80.2 percent they were hoping for.

The trick to keep the medical loss ratio low, and profits up, is to pay less money in claims.

One way to do that is through a process called rescission. Rescission is when an insurance company rejects a policy because of an error in the application process. One woman testified before Congress that her policy was rejected because she failed to note on her application that she had been treated for acne. She was undergoing breast cancer treatment.

But rescission is just one way to drive down costs and increase profits. Here’s Potter explaining the industry’s tactics to keep the medical loss ratio low.

Rescission is one thing. Denying claims is another. Being, you know, really careful as they review claims, particularly for things like liver transplants, to make sure, from their point of view, that it really is medically necessary and not experimental. That’s one thing. And that was that issue in the Nataline Sarkisyan case.

But another way is to purge employer accounts, that – if a small business has an employee, for example, who suddenly has have a lot of treatment, or is in an accident. And medical bills are piling up, and this employee is filing claims with the insurance company. That’ll be noticed by the insurance company.

And when that business is up for renewal, and it typically is up, once a year, up for renewal, the underwriters will look at that. And they’ll say, “We need to jack up the rates here, because the experience was,” when I say experience, the claim experience, the number of claims filed was more than we anticipated. So we need to jack up the price. Jack up the premiums. Often they’ll do this, knowing that the employer will have no alternative but to leave. And that happens all the time.

The Washington Post ran a brief about the medical loss ratio back in April 2006. According to the story, Aetna’s medical loss ratio “increased last quarter from 74.6 to 79.4, causing a 20 percent plunge in its share price when it was announced.” Perhaps this was the company Potter was referring to when he said to Moyers: “I’ve seen a company stock price fall 20 percent in a single day, when it did not meet Wall Street’s expectations with this medical loss ratio.”

The medical loss ratio, according to the Post story, is the best indicator to investors “of a future turn in the health-insurance industry’s profit cycle.”

So it’s no surprise that insurance industry profits are going up, more people are uninsured and under-insured and the insurance industry really likes the status quo.

And as for government-run health care, such as Medicare, 97 percent of all money goes towards patient care, with only 3 percent for administration costs. Obviously there’s not a profit motive with a government health plan.

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Bill Moyers Journal: Wendell Potter on Profits Before Patients
Washington Post: Medical Loss Ratio
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