The Narrative
"The insurance companies last year alone sucked $23 billion in profits out of the health care system."[1]
‐ Elizabeth Warren
"[P]rivate insurance companies in this country spend between 12 and 18 percent on administration costs.... We can save approximately $500 billion a year just in administration costs."[2]
‐ Bernie Sanders
"It is inhumane to make people go through a system where they cannot literally receive the benefit of what medical science can offer because some insurance company has decided it doesn’t meet their bottom line in terms of their profit motivation."[3]
‐ Kamala Harris
Reality
Health insurance is expensive because spending on hospital and physician services is high. Insurers are unpopular because they bear the main responsibility for controlling this spending‐but their doing so saves consumers money and focuses resources toward better care. A comparison of plan options under Medicare can quantify the value added by private insurance management. Private plans reduce costs by about 10%, allowing them to provide over $1,000 in extra health-care coverage to each Medicare enrollee every year.