Obama on driving down costs
In a 2007 Democratic debate, Obama said, "My emphasis is on driving down the costs, taking on the insurance companies, making sure that they are limited in the ability to extract profits and deny coverage, and the drug companies have to do what's right by their patients instead of simply hoarding their profits." Translation: A good way to shift healthcare cost to the tax payer is to remove any incentive from private companies to do a good job. Insurance companies and drug companies as a whole do not do what is right by their patients - oops doctors have patients, companies have customers - so, as I was saying insurance companies and drug companies never do right by their customers, instead, they always, only, hoard their profits. FACT: According to the St. Petersburg Times, POLITIFACT.com, a 2009 Pulitzer Prise Winner, This may have been true briefly in 2007 when the above statement was made. According to this same article, written July 23, 2009, Obama continued to speak about insurance company profits when he said on July 22, 2009, Health Insurance Companies are making record profits right now." Here is a piece of what the article had to say, "It seems likely that Obama was referring to the latest earnings report from UnitedHealth Group, one of the largest publicly traded health insurance companies. The day before Obama's news conference, UnitedHealth had announced unexpectedly robust profits that prompted the company to revise its annual earnings guidance upwards.
There are many ways to look at a company's earnings, but Obama said "profits," so we looked at net income, which is revenue minus expenses. For the quarter, UnitedHealth earned $859 million. But that's not a record for quarterly net income. During the same period in 2007, for example, its net income was $1.23 billion.
We reviewed the income statements of the other largest publicly traded health insurance companies — WellPoint, Aetna, Cigna, Humana and Coventry Health Care — and found similar trends. Generally speaking, profits were higher during 2007 and 2006, before the economy began its slide. So Obama's modifier "record" does not appear to be correct."
It would be hard to argue that drug companies are not making record profits in the middle of this crisis, however, they often take a back seat in the discussion of reform. It is mostly an all out attack on insurance companies and their soldiers, agents and brokers, who are the center target for reformers. That could have something to do with other negotiations going on in the background over Medicare. At the end of the day all of this saber rattling has to do with "financing" not delivery, and that makes this argument about profits a very one-sided debate.