In this week’s episode of can’t make this sh*t up……….
Optum is buying Steward Health Care’s physician group
Yes, that Optum
Yes, that Steward
I can’t even really
Why is this a problem?
Well, other than the obvious, here’s how United will contiue to make unimaginable sums of money
As a “health” insurance company, United can’t make more than 15% ish in profit because of the medical loss ratio laws
But, its subsidiaries sure as heck fire can
Optum is a subsidiary
90,000 doctors are employed by Optum
So, United jacks up the price of the services deliverd by these docs and groups
It spends it’s money on claims paid to the groups and hits its 85% MLR
But the group is making a much higher margin than 15%
And guess who ultimately gets that money?
Ya, United
I made a picture
United’s all-in cost is the cost of the physician group, not what it paid them
That gets eliminated
It’s vertical integration
The game isn’t better healthcare
The game is more money
And they are real good at the game
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