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EDITORIAL: Private Insurance

The Lufkin Daily News

Monday, October 26, 2009

Democrats have used the insurance companies as a convenient target in their efforts to convince Americans we need their version of health care reform. Vilified as making "obscene" and "immoral" profits, private insurance companies have been painted as one of the primary villains causing health care cost to increase.

Thanks to the Associated Press, which carefully researched this issue, the truth is nowhere near what House Speaker Nancy Pelosi (D-Calif) would have us believe, unless one thinks a profit margin of 2.2 percent is obscene.

That's the average profit number the private insurance companies posted last year. HealthSpring, the best performer in the industry, posted a profit of 5.4 percent. The industry ranked 35th among the 53 industries on the Fortune 500 list. The industry trailed consumer goods and household products manufacturers, brewers and returned about a tenth of the profit margin network and communications equipment businesses did.

We don't think a profit margin of from 2.2 to 5 percent is unreasonable, much less obscene or immoral. Maybe it is when you compare it to the type of returns the USPS and Amtrak produce.

On another front, the Obama administration is currently battling the United States Chamber of Commerce over the organization's lack of support for some of its proposals, including health-care reform and the cap and trade scheme. The chamber is a private organization supported by American businesses. The administration is attempting to marginalize the organization and, by default, the businesses it represents.

A casual observer could easily conclude there seems to be an effort to demonize our businesses, businesses that employ millions of Americans, businesses that pay taxes and most importantly, businesses that have greatly contribute to the quality of life we enjoy in this country.

We hope that's not the case.

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