Why do we need health insurance companies?

Health insurance companies can't cure anyone, prevent any disease, develop new treatments or create better medicines. Yet they take a cut of your health care dollar, create endless paper, interfere with doctors and enrich shareholders. They can all be replaced by software.

Tell me why health insurance companies should exist.

1 Answer

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  • Sandra
    Lv 7
    1 decade ago
    Best Answer

    Well, they employ lots of people and enable a few of them to get rich! That's considered a good enough reason in the U.S.

    There isn't any other reason, if there is an alternative such as single payer (the whole country, as in the government).

    The reason we have this system here is historical. There wasn't much of a central government for a long time. Various immigrant groups developed mutual insurance (risk sharing), first to pay for funerals, later for illness. They put in money, and if it was not all spent on the problems, the rest was returned to them. Money being held for the purpose could be invested, and investment became the real source of wealth for these companies.

    These mutual insurance companies sometimes became very large. Many of them stopped being mutual and "went public", so as to obtain even more money for investments, which made them subject to shareholder desires for profit.

    Now that we have this system, it is almost unimaginable that there may be another way! And there are a lot of vested interests. Still, the time for these companies is past, as you have recognized. The U.S. has become a dinosaur.

    Source(s): Some of the companies in this article have become "public" since it was written: http://en.wikipedia.org/wiki/Mutual_insurance
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