Gardner: Is it 'greedy' to pay for top-notch health care in US? (copy)

Are insurance companies "greedy"?

News reports about the murder of UnitedHealthcare CEO Brian Thompson have quickly detoured into discussion about how much Americans hate their health insurance carriers.

Here is some of the invective aimed at UnitedHealthcare:

"Guys like Brian Thompson are parasites and criminals."

"Sorry, my empathy is out of network."

"I'm mourning the people he killed by withholding care, not the man who killed them."

"Imagine being in such a crappy industry that people laugh at your death."

CVS has removed pictures of its top executives from the company's website, fearing they will be assassinated, too. Private security outfits are deluged with inquiries about protecting C-suite types from harm. Thompson himself is branded a mass murderer in some posts.

Usually, the rants refer to this industry group as "greedy" for trying to make a profit.

Are they "greedy?" Look at some numbers before making up your mind.

UnitedHealthcare is a gigantic corporation, pulling in $389 billion in revenue over the previous year. That is more than $1 billion daily.

Analysts look at insurance businesses by examining their "medical loss ratio." That is the percent of insurance revenues paid out to policy holders. At UNH it is 85%. Paying medical insurance claims is UHC's biggest expense by far.

The other 15 cents of every dollar of revenue is spent paying UNH's 440,000 employees, leasing office space, heating, cooling and lighting those offices and paying federal, state and local taxes on the profit.

The net, after-tax profit at UnitedHealthcare last year was $14 billion. Sounds like a lot. It is only 3.6% of revenue.

Nearly 97 cents of every dollar collected by UnitedHealthcare is given back to policy holders, employees, suppliers and vendors and the general public through the levy of income and property taxes.

That leaves shareholder owners about three cents on the dollar.

Other major competitors profit even less from providing health insurance. CVS clears 1.3% of revenues as profit; Humana just 1.1%. It barely pays to stay in business.

So, are they greedy?

Providing good medical care is expensive whether you do it through for-profit insurance companies or through the government. Critics want us to move to a non-profit, single payer system, like Medicare. As a Medicare recipient myself for 10 years, I can testify that the program works great, if you never look at the financials.

The basic monthly premium of $180.50 starting next year pays only 15% of the cost of Medicare. Payroll taxes take care of about 42% of costs. The U.S. Treasury covers the remaining 43%.

Medicare will run a $449 billion deficit this year, covered by surpluses accumulated in the past and parked in the Hospital Insurance Trust Fund and the Supplemental Medical Insurance Trust Fund and by general revenues.

Medicare will be broken in 2036 just insuring Americans over 65. Imagine trying to also cover everyone else.

The British Royal College of Emergency Medicine estimated that 14,000 people died in that country last year waiting to be seen by the country's taxpayer supported, non-profit National Health Service.

Spoiler alert: if you think private insurance companies are awful for denying benefits now, wait until the federal government must ration health care in a dozen years.