MedicalLossRatio

The article by bestselling author, and former health insurance industry communications director, Wendell Potter, discusses how private health insurers that dominate healthcare in the U.S. manipulate the Medical Loss Ratio (MLR) to their advantage. The MLR is a measure mandated by the Affordable Care Act (ACA) that requires insurers to spend a minimum percentage of premium revenues on clinical services and quality improvements. The article highlights tactics insurers use to inflate their MLRs artificially, such as categorizing administrative costs as medical expenses. This manipulation allows insurers to meet the required thresholds without genuinely increasing spending on patient care.

One popular trick is manipulating the definition of “quality improvement” activities. These are supposed to be initiatives that genuinely improve patient care and keep us from getting sick in the first place. But insurers often stretch the definition of “quality improvement.” Suddenly, things like fancy software upgrades or marketing campaigns to lure in more customers (sorry, “educate” patients) get counted as quality improvement, reducing the apparent profits and making it seem like they’re spending more on health care than they really are.

As if that wasn’t bad enough, crafty insurers have figured out yet another way to keep more of your money than Congress intended. They have bought hundreds of physician practices and clinics and steer their health plan “members” to the docs they employ and facilities they own. That’s because the ACA’s MLR provision doesn’t apply to health care delivery, just health insurance.

The article provides an insight into how the current healthcare system is actually one of wealth extraction, where health is commodified and continuously rising premium costs are confiscated for private profit rather than patient care.

READ THE ARTICLE by Wendell Potter HERE

And, of course, this is the crux of why we cannot make significant headway in overcoming glaring healthcare disparities, because things like culturally appropriate care can’t get public funding directed towards it as these funds are being confiscated for private profit. This is why we must win CalCare and Medicare-for-All. There will be no end to unnecessary deaths and medical debt in the U.S. without the elimination of private insurer control over public funds for healthcare, which includes billions in bureaucratic administrative waste.