White House unfairly demonizes corporations

The most inefficient company in America runs a trillion-dollar deficit, yet its leaders remain in power year after year. Unfortunately for taxpayers, this corporation is the federal government. The federal government loves to hate on other larger, more efficient corporations.

Thanks to the hard work of President Barack Obama and House Speaker Nancy Pelosi, the most despised corporations in America are now the large health insurance providers. These companies go unnamed by the administration because they are not well-known. Unlike Nike or Wal-Mart, private insurance companies are not brand names and do not receive the kind of derisive comments directed at bigger names.

Every public corporation releases quarterly statements that definitively report the profits of the corporation. Underestimating profits would be ludicrous due to the negative effects on the stock price. While millions of shareholders may read the company's earnings statements, the Obama administration seems to have overlooked a few very important figures One of the larger private insurance companies is WellPoint Inc. WellPoint is better known for the distribution of policies under the Blue Cross, Blue Shield moniker. After hearing countless diatribes against the private industry, the average American would strongly believe that WellPoint has a profit margin on par with that of a sweatshop. This belief is false.

WellPoint's profit margin last quarter was 4 percent. That means 96 cents out of every dollar of revenue went to expenses such as health care procedures, employee salaries and to the government in the form of taxes.

This small profit margin is not restricted to WellPoint. The largest health care company in America is UnitedHealth Group, which had a profit margin of 3.7 percent. If anyone operated a lemonade stand on such a slim margin, they would probably give up.

UnitedHealth charges premiums based on what the brightest minds in accounting believe would gain the most customers from competition and the highest profit. The slightest change in the rates could risk the profitability of the company. Simple math shows a $4 per month change in overall premiums would easily push UnitedHealth into the red.

This action may come forcibly by the government. House bills have mentioned removing the risk factor that companies usually figure into their premiums for deeds such as smoking, obesity and preexisting conditions. If any of those bills pass, major health insurance companies will have to cut coverage and jobs or face bankruptcy.

For every horror story of people getting shafted by the insurance provider, there are many success stories. Unfortunately, success stories go unreported, because they make bad television. No anchorman is going to go on the evening news and report how someone has cancer, but his treatments are being promptly paid for by an insurance company. Most people would find it boring. On the other hand, a thrilling tale of legal battles while a patient's life is on the line makes for much better ratings and taints the public perception of the insurance industry.

Even if health care legislation passes, people will still eat too much, hospitals will still not follow procedures and 70 million Americans will lose their insurance coverage, because the administration promised lower premiums and forgot that corporations have a responsibility to make a profit.