Thursday, February 1, 2018

My take on the Amazon, Berkshire Hathaway, JPMorgan Chase foray into health insurance

Okay, so a lot of people are freaking out about this thinking that the 3 power house combo is going to actually do something significant in the marketspace. Health insurer stocks tumbled, investors are jittery.

It's all BS.

How many times have I used this term in my posts?


Why am I saying this?

Because what people think will save money won’t. I can take their group TODAY, and change their medical spend TODAY, freeing up massive amounts of cashflow TODAY. Guaranteed or I don’t get paid (I only get paid after I demonstrate results).

The best that they can do is the create something similar to what Kaiser has done in California. It’s a great system, but nothing new. Here are several reasons why.

1.       There is a floor to how much you can pay doctors. Any less and they will work for someone else.
2.       There is a floor to how much you pay hospital staff. Any less and they will work for someone else.
3.       My personal opinion is that 30% of ALL studies that modern medicine is based upon are either fake (artificially generated results) or not able to be replicated. More of bad medicine means sicker people, not healthier.
4.       They will buy into the three darlings of large brokerages:
a.       Population Health Management
b.       Wellness
c.        Analytics
These WILL NOT dramatically impact the severity and frequency of claims THIS YEAR. They will save a little money, but no more than “dust on a peanut” for a large employer.
5.       They will listen to “experts” who will tell them that cost increases due to “trend” are inevitable and PAY them money when their rates go up by millions of dollars (and think it’s okay).

Technology will NOT solve these problems.
Technology will NOT dramatically reduce the severity and frequency of claims.
My best guess is that they will NOT allow alternative medicine into the mix (acupuncture, naturopathy, etc). If they do, good for them. But it will still NOT reduce the severity and frequency of claims.

Have I made myself clear enough?

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