The Sunlight Report on UnitedHealth Group is a first-of-its-kind look at the nearly 2,700 subsidiaries that make up UnitedHealth Group, the largest health care conglomerate in the world.
An excellent report. I appreciate the invitation to read the full result in the Sunlight report, and to provide my opinion of its content, but realistically I am neither qualified to interpret the figures and charts found therein, or have the time to do so. What I would appreciate instead, is some guidance on how to go about raising this issue to the correct decision makers in government and to elected officials at both the state and federal level demanding action. That I can do.
This was an eye-opening piece. Thank you not only for the article but for all the work that went into it.
What I find ironic is that while Americans are opposed to a single-payor healthcare system, with Unitedhealth Group that's what we're increasingly getting.
Yes, but UnitedHealth is FOR PROFIT rather than NOT FOR PROFIT. A federal single-payer system would effectively be not for profit which means our premiums would go towards actual health care costs plus administrative costs. Premiums would not go to shareholders and a highly paid CEO and upper management, so overall costs could be lower.
Thank you for another excellent article. I was proud to see you in Washington yesterday, standing with the Legislators and activists at the introduction of SBUHCA, State Based Universal Health Care Act. Your support to individual states such as my own Colorado in addition to national efforts makes a difference, and we are grateful. You spoke at our Colorado Foundation for Universal Health Care conference in June, and I look forward to hearing you at the One Payer State conference in Denver in August.
“... any transaction that could be considered 'material to earnings'.”
That would be ALL transactions. Every single one of them is "material to earnings" just as every straw is material to the load on a camel's back. The straw that breaks the camel's back is no more and no less significant (material) than any other straw – it is simply one more of many that ultimately became too many.
The acquisition transaction that is one too many could be absolutely any transaction on the list ... if it came last on the list. To think otherwise is to assume (erroneously) that the order in which the transactions happen is of greater significance than the cumulative effects of each and every one of the transactions.
Great breakdown of the report. I just wrote up an article on the antitrust approach to UHG; how they won when acquiring Change Healthcare, and how they might not with Amedisys.
Curious what you think the best strategy is for breaking up UHG?
Did you hear about the UHG nursing home scandal? If people have loved ones in long term care, or doctors that are employed by Optum, or insurance through United, antitrust helps protect their ability to actually receive the healthcare they pay for.
60-70% of the people want universal healthcare. This video shows how: Put the market on the SUPPLY side & and put single-payer M4A on the DEMAND side. If Democrats learn to talk both social AND market principles, they will win elections. Democratic candidates should watch the full playlist, called "New Addition to Economics."
Guardrails are a concept that would need to be hammered out.
I’m simply stating that there obviously needs to be some.
That would be much easier to do when the Federal money is stripped from the behemoths and they organically begin to shrink in size or disappear altogether and reappear in a different and smaller form.
As for taxes, take a look at this (sorry, it’s kind of ugly) and tell me which trends you noticed.
It’s the population and avg tax rate as % of income of some of the top countries with socialized medicine, and then the same for the US at the bottom:
TAXES--Assume that the 29.8% average U.S. tax rate already includes FICA. Add the total contribution (employee + employer) to PRIVATE healthcare premiums as a percentage of income (around 14%? in 2020) plus average deductibles (4.7%). That gives the U.S. somewhere around 48.5% average fed. tax rate including all healthcare, the highest rate in the chart. That may be a little high; let's split the difference and make it 40%.
I don't know what the population size has to do with it. Larger numbers should engage larger economies of scale, in innovation, and in the risk pool.
GUARDRAILS--U.S. currently has a situation in which guardrails were hammered out, yet currently private health insurance is rife with rent-seeking and market failure, including capture of government. This is Wall Street's endemic culture. There is little reason to believe that anything but a clean break will fix this.
Another question: What value-added does private health insurance bring to the healthcare itself?
Not exact, but a really good generic measure for trending purposes.
Though, to your point, you can bet that there will be new tax vehicles galore dreamed up to try and collect as much tax revenue as possible.
And we all know that once a tax is deployed, it is rarely if ever retracted, and that would be especially true in this case.
So once the boomers are gone and healthcare spending drops dramatically, we would get some money back?
LOL - nope, not a chance.
What you missed is how the tax rate increases proportionally with population count.
There’s no ‘economy of scale’ here, we’re talking healthcare, not selling Volvo’s.
There’s no magical production line innovation that’s going to reduce the cost of care per person.
If there were; would it not already be deployed? Are you under the impression that private insurance WANTS to pay more for care?
That’s silly.
Also, risk pool doesn’t exist in the government model, there’s no sort of hedging the bets between healthy and less healthy populations like private insurance.
It’s government controlled, it means everyone regardless of risk or cost.
As for the guardrails, you’re missing the point of the smaller, non-behemoth payors.
Not to mention, your perception of any current guardrails not working certainly doesn’t imply that no guardrails that work can ever be found. That’s also silly.
I’m not sure what you mean by “rife with rent-seeking and market failure, including capture of government”, but the only people that will really benefit from Universal Care are the boomers and they’ll be largely gone before it could really even get off the ground at scale.
So, again, Medicare / Medicaid reform is your answer.
Leave the rest to the younger folks like myself that will still be here for decades and decades and decades to come.
Please provide a link to the source of your list of tax rates.
Taxes are often reduced. Assertions to the contrary ignore history (even absent the current OBBB travesty).
There are multiple and interconnected economies of scale to be found in: 1. Reduced healthcare administrative costs. 2. Reduced costs for marketing of supply innovations, thus reducing costs of care per person. 3. Keeping more people healthy, learning, growing and working, thus increasing economic growth. 4. Easier and cheaper business start-ups, thus increasing economic growth. 5. Making U.S. labor costs more competitive in world markets, thus increasing production for export. 6. Reduced individual time, attention and transaction costs in dealing with healthcare and insurance issues.
Thus, boomers would benefit LEAST from universal healthcare: they are already retired, already covered.
Of COURSE the risk pool concept exists in public insurance. You just don't need to hedge bets. The larger the risk pool, the further risk is spread, reducing costs for individuals including chronic illness or personal catastrophe, at whatever age.
What is the logic behind your assertion that reducing the size of payors will decrease their rent-seeking? You have to explain logically how your guardrails will work, not just hand-waving that guardrails will suddenly be found (perhaps against historical evidence and political reality).
And please answer the question: What "value-added" does private health insurance add to healthcare? What are you paying the extra money FOR?
Links to your detailed AI prompt and your deep-seek sourcing? Or just coy and paste them.
Which of your questions did I not answer? Pick one.
Which of your points were not responded to? Pick one.
The government is cheaper than the private sector in the provision of many "public goods", as defined in economics, and particularly in the case when "transaction costs" are high, as demonstrated by Coase (1960).
Or take the case of universal healthcare, where the average cost in OECD countries is around 10% of GDP, as opposed to the U.S.'s 17.6%.
Most of these single payer systems use the free market on the supply side, a type of "outsourcing" I suppose, and indeed pictured in the video.
Please answer the question: What "value-added" does private health insurance add to healthcare? What are you paying the extra money FOR?
The problem with that argument is that 22% of that number comes from the elderly boomer population, down from their peak of 39% when the youngest turned 18 and expected to be 10% by around 2040.
Rather than saddle entire current and future generations with the inevitable and growing tax hikes and inequities that would come from Government run healthcare, it makes more sense to come up with something better to account for the aging and more expensive portions of the population.
If 2 or more things can be true at the same time, it becomes clear that in this case, it’s Medicare and Medicaid reform along with better guardrails for non-government care.
It makes much more sense to eliminate commercial payors from Medicare and Medicaid altogether and let the government run that portion completely.
The commercial payors would then focus on non-M&M populations.
By eliminating the commercial payors from all that sweet government money, the notion of the healthcare behemoth organically begins to dissipate.
I don’t disagree with Potter on this one, though I often do.
However, the monopoly argument is a tough one in this case, because UHC at 50m lives only covers about 14.8% of the population.
Let’s compare that to 2 of the most well known monopoly breakups in semi-recent history, Standard Oil and AT&T.
- Standard Oil's dominance impacted the livelihoods of potentially 80-90% of Americans, either directly or indirectly, due to its control over the energy sector.
- AT&T's dominance impacted nearly 100% of Americans who used telephone services.
So, yeah, monopoly is a tough argument in this case.
It seems the best case might be the DOJ coming up with something to help drive re-orchestration in the healthcare vertical.
An excellent report. I appreciate the invitation to read the full result in the Sunlight report, and to provide my opinion of its content, but realistically I am neither qualified to interpret the figures and charts found therein, or have the time to do so. What I would appreciate instead, is some guidance on how to go about raising this issue to the correct decision makers in government and to elected officials at both the state and federal level demanding action. That I can do.
Has UnitedHealthgroup acquired the Sun yet?
We deserve a national healthcare system that covers total cost of all medical necessities for all U.S. residents for life
This was an eye-opening piece. Thank you not only for the article but for all the work that went into it.
What I find ironic is that while Americans are opposed to a single-payor healthcare system, with Unitedhealth Group that's what we're increasingly getting.
Yes, but UnitedHealth is FOR PROFIT rather than NOT FOR PROFIT. A federal single-payer system would effectively be not for profit which means our premiums would go towards actual health care costs plus administrative costs. Premiums would not go to shareholders and a highly paid CEO and upper management, so overall costs could be lower.
Exactly. And therein lies the problem. Over on LinkedIn I posted my own take on this.
Thank you for another excellent article. I was proud to see you in Washington yesterday, standing with the Legislators and activists at the introduction of SBUHCA, State Based Universal Health Care Act. Your support to individual states such as my own Colorado in addition to national efforts makes a difference, and we are grateful. You spoke at our Colorado Foundation for Universal Health Care conference in June, and I look forward to hearing you at the One Payer State conference in Denver in August.
Excellent and detailed article. I appreciate your knowledge and commitment to making public healthcare available to all of us.
“... any transaction that could be considered 'material to earnings'.”
That would be ALL transactions. Every single one of them is "material to earnings" just as every straw is material to the load on a camel's back. The straw that breaks the camel's back is no more and no less significant (material) than any other straw – it is simply one more of many that ultimately became too many.
The acquisition transaction that is one too many could be absolutely any transaction on the list ... if it came last on the list. To think otherwise is to assume (erroneously) that the order in which the transactions happen is of greater significance than the cumulative effects of each and every one of the transactions.
The Truth Must Be Shared!
Great breakdown of the report. I just wrote up an article on the antitrust approach to UHG; how they won when acquiring Change Healthcare, and how they might not with Amedisys.
Curious what you think the best strategy is for breaking up UHG?
How does anti-trust and conflict of interests help the masses with the current Republican potus
Did you hear about the UHG nursing home scandal? If people have loved ones in long term care, or doctors that are employed by Optum, or insurance through United, antitrust helps protect their ability to actually receive the healthcare they pay for.
One thing to learn is that if someone is lying to another, they are lying to you.
60-70% of the people want universal healthcare. This video shows how: Put the market on the SUPPLY side & and put single-payer M4A on the DEMAND side. If Democrats learn to talk both social AND market principles, they will win elections. Democratic candidates should watch the full playlist, called "New Addition to Economics."
https://www.youtube.com/watch?v=_-3CSl7yo_I
Guardrails are a concept that would need to be hammered out.
I’m simply stating that there obviously needs to be some.
That would be much easier to do when the Federal money is stripped from the behemoths and they organically begin to shrink in size or disappear altogether and reappear in a different and smaller form.
As for taxes, take a look at this (sorry, it’s kind of ugly) and tell me which trends you noticed.
It’s the population and avg tax rate as % of income of some of the top countries with socialized medicine, and then the same for the US at the bottom:
Country Population Tax%
Iceland 0.376m 34.0%
Croatia 3.8m 39.0%
New Z 5.1m 27.9%
Norway 5.5m 35.7%
Denmark 5.9m 36.6%
Canada 40.0m 41.4%
UK 67.8m 44.8%
Germany 84.3m 46.9%
Japan 125.1m 52.7%
USA 340.1m 29.8%
TAXES--Assume that the 29.8% average U.S. tax rate already includes FICA. Add the total contribution (employee + employer) to PRIVATE healthcare premiums as a percentage of income (around 14%? in 2020) plus average deductibles (4.7%). That gives the U.S. somewhere around 48.5% average fed. tax rate including all healthcare, the highest rate in the chart. That may be a little high; let's split the difference and make it 40%.
I don't know what the population size has to do with it. Larger numbers should engage larger economies of scale, in innovation, and in the risk pool.
GUARDRAILS--U.S. currently has a situation in which guardrails were hammered out, yet currently private health insurance is rife with rent-seeking and market failure, including capture of government. This is Wall Street's endemic culture. There is little reason to believe that anything but a clean break will fix this.
Another question: What value-added does private health insurance bring to the healthcare itself?
No, those are all in avg tax rates.
Not exact, but a really good generic measure for trending purposes.
Though, to your point, you can bet that there will be new tax vehicles galore dreamed up to try and collect as much tax revenue as possible.
And we all know that once a tax is deployed, it is rarely if ever retracted, and that would be especially true in this case.
So once the boomers are gone and healthcare spending drops dramatically, we would get some money back?
LOL - nope, not a chance.
What you missed is how the tax rate increases proportionally with population count.
There’s no ‘economy of scale’ here, we’re talking healthcare, not selling Volvo’s.
There’s no magical production line innovation that’s going to reduce the cost of care per person.
If there were; would it not already be deployed? Are you under the impression that private insurance WANTS to pay more for care?
That’s silly.
Also, risk pool doesn’t exist in the government model, there’s no sort of hedging the bets between healthy and less healthy populations like private insurance.
It’s government controlled, it means everyone regardless of risk or cost.
As for the guardrails, you’re missing the point of the smaller, non-behemoth payors.
Not to mention, your perception of any current guardrails not working certainly doesn’t imply that no guardrails that work can ever be found. That’s also silly.
I’m not sure what you mean by “rife with rent-seeking and market failure, including capture of government”, but the only people that will really benefit from Universal Care are the boomers and they’ll be largely gone before it could really even get off the ground at scale.
So, again, Medicare / Medicaid reform is your answer.
Leave the rest to the younger folks like myself that will still be here for decades and decades and decades to come.
Please provide a link to the source of your list of tax rates.
Taxes are often reduced. Assertions to the contrary ignore history (even absent the current OBBB travesty).
There are multiple and interconnected economies of scale to be found in: 1. Reduced healthcare administrative costs. 2. Reduced costs for marketing of supply innovations, thus reducing costs of care per person. 3. Keeping more people healthy, learning, growing and working, thus increasing economic growth. 4. Easier and cheaper business start-ups, thus increasing economic growth. 5. Making U.S. labor costs more competitive in world markets, thus increasing production for export. 6. Reduced individual time, attention and transaction costs in dealing with healthcare and insurance issues.
Thus, boomers would benefit LEAST from universal healthcare: they are already retired, already covered.
Of COURSE the risk pool concept exists in public insurance. You just don't need to hedge bets. The larger the risk pool, the further risk is spread, reducing costs for individuals including chronic illness or personal catastrophe, at whatever age.
What is the logic behind your assertion that reducing the size of payors will decrease their rent-seeking? You have to explain logically how your guardrails will work, not just hand-waving that guardrails will suddenly be found (perhaps against historical evidence and political reality).
And please answer the question: What "value-added" does private health insurance add to healthcare? What are you paying the extra money FOR?
Wow, you really have to work at it to get that many things backwards.
The tax data comes from a detailed AI prompt in combination with deep seek sourcing, not a single source.
So, you’ll have to work on that on your own time.
Hint: it gets fairly complex when you start dealing with international taxes across multiple countries and chatGPT won’t get you there.
And to be fair, you didn’t answer any of my questions or provide a cogent response to most of my points but are demanding that I answer yours?
You first big guy.
I responded to you previously and you didn’t return the favor.
While we’re at it, think about this one too; name one time in recent history that the government did something cheaper than the private sector?
Is it your expectation that this will miraculously change because it’s healthcare?
Has the government outsourcing many, many things not been the model in many, many areas for many, many years for that very reason?
You can start with those, but please try and keep your responses to less than a Michener novel.
Links to your detailed AI prompt and your deep-seek sourcing? Or just coy and paste them.
Which of your questions did I not answer? Pick one.
Which of your points were not responded to? Pick one.
The government is cheaper than the private sector in the provision of many "public goods", as defined in economics, and particularly in the case when "transaction costs" are high, as demonstrated by Coase (1960).
Or take the case of universal healthcare, where the average cost in OECD countries is around 10% of GDP, as opposed to the U.S.'s 17.6%.
Most of these single payer systems use the free market on the supply side, a type of "outsourcing" I suppose, and indeed pictured in the video.
Please answer the question: What "value-added" does private health insurance add to healthcare? What are you paying the extra money FOR?
The problem with that argument is that 22% of that number comes from the elderly boomer population, down from their peak of 39% when the youngest turned 18 and expected to be 10% by around 2040.
Rather than saddle entire current and future generations with the inevitable and growing tax hikes and inequities that would come from Government run healthcare, it makes more sense to come up with something better to account for the aging and more expensive portions of the population.
If 2 or more things can be true at the same time, it becomes clear that in this case, it’s Medicare and Medicaid reform along with better guardrails for non-government care.
It makes much more sense to eliminate commercial payors from Medicare and Medicaid altogether and let the government run that portion completely.
The commercial payors would then focus on non-M&M populations.
By eliminating the commercial payors from all that sweet government money, the notion of the healthcare behemoth organically begins to dissipate.
Tada!
Problem solved.
Why would a single payer have inevitable and growing tax hikes and inequities?
And how will you ensure that better guardrails for non-governmental care are followed?
I don’t disagree with Potter on this one, though I often do.
However, the monopoly argument is a tough one in this case, because UHC at 50m lives only covers about 14.8% of the population.
Let’s compare that to 2 of the most well known monopoly breakups in semi-recent history, Standard Oil and AT&T.
- Standard Oil's dominance impacted the livelihoods of potentially 80-90% of Americans, either directly or indirectly, due to its control over the energy sector.
- AT&T's dominance impacted nearly 100% of Americans who used telephone services.
So, yeah, monopoly is a tough argument in this case.
It seems the best case might be the DOJ coming up with something to help drive re-orchestration in the healthcare vertical.