AP finally reports on insurance industry's thin margins

While Democrats in Congress have spent months demonizing insurers as greedy villainous monsters, from Barack Obama to Nancy Pelosi to Alan Grayson, the American media stood mute rather than report on the extent of this supposed greed.  Why?  It’s not as if these companies don’t have annual reports, or that business media haven’t tracked their performance.  The publicly-traded companies have their bottom lines exposed for all to see, and yet the media has steadfastly whistled and looked askance rather than inform people about the extent of their demonic, villainous, greedy, filthy lucre.

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The AP finally got around to it today … on a Sunday, where it’s likely to be buried:

Quick quiz: What do these enterprises have in common? Farm and construction machinery, Tupperware, the railroads, Hershey sweets, Yum food brands and Yahoo? Answer: They’re all more profitable than the health insurance industry. In the health care debate, Democrats and their allies have gone after insurance companies as rapacious profiteers making “immoral” and “obscene” returns while “the bodies pile up.”

Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent, give or take a point or two. That’s anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.

Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year, as investors were warned of a stagnant if not shrinking market for private plans.

The average profit margin for health insurers last year clocked in at an anemic 2.2%.  What does that mean from the investor position?  They would have done better to put their money into FDIC-insured savings accounts at their local bank, let alone a CD or other guaranteed investment device.  A 2.2% profit margin would normally trigger a stockholder revolt.

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In comparison, trial lawyers showed a profit margin of almost 14%, six times that of the health insurers.  Do Democrats scream about villainous trial lawyers and windfall profits taxes on those that exploit the legal system and drive prices up across all American industries?  No, because the trial lawyers share a good portion of their filthy lucre with Democrats.

I’m glad the AP finally decided to check facts on Democratic lies about the health-insurance industry.  My question to them would be, what took you so long?  And to the rest of the media, why haven’t you done any real reporting on this outrageous lie?

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