Tuesday, June 09, 2009

The Wisdom of United HealthCare

United HealthCare is one of the largest medical insurance companies around. They never pass up a chance of sticking it to doctors and patients. They also publish some rather fascinating garbage, like here:
Through its diversified family of businesses, it leverage (sic) core competencies in advanced technology-based transactional capabilities; health care data, knowledge and information; and health care resource organization and care facilitation to improve access to health and well-being services, simplify the health care experience, promote quality and make health care more affordable.
My experience with this company has been almost the exact opposite of this quote. In particular, it has impeded access to health and well-being services (the "prior-auth" gambit), it has not promoted quality but quantity (increase office visits or die), and has done nothing to make health care more affordable (see below)

In 2008, UHC's revenues were $81,186,000,000. Their payout to doctors, hospitals, etc. was $60,359,000,000, or only 75% of what they took in (it was only 71% the year before). This means that $21 Billion stayed in the company.

The CEO of UHC in 2007 was Stephen J. Hemsley. He "raked in $5,029,838 in total compensation.* In the previous year the CEO of this company made $8,748,422."

3 comments:

Felix Grant said...

Overcoming my knee jerk left wing European responses ... do we know how much of that 21 billion is consumed by operating costs?

Dr. C said...

Felix, That is hard to say. One of the facts (though it is hard to track down) about the American medical system is that the Government run programs, like Medicare and Medicaid, have low overhead. For instance:, "....Medicare’s administrative costs are just 3% of total spending, while the private sector hits 11% to 14%." So, if UHC had a 14% overhead this would still leave about 10% of revenues as "profit," which would be about $8 Billion.

It is hard to ferret out from their 10-K, but I think that there is a very small number of stock holders to divy up this booty. In any case, medical decision making shouldn't have input from stockholder's greed.

The Senate version of the health care proposal was just released yesterday (it will certainly be called the Kennedy Bill) and I have yet to read its 615 pages, but I will!

My local representative in Congress (that I supported and voted for) may have gone over to the dark side on this, but I am going to try and convince him otherwise.

Anonymous said...

No fan of united or hemsley
one thing your missing in your numbers--they have significant revenue from fee business; I.e. Does not have offsetting med expenses