Artful Dodger:

> The government is a far worse option.

I think we would have to be very naive if we think that the private sector is free from corruption. Historically, the private sector has existed for one and only one purpose: profit.

Health insurance companies did not go into that business to give away free health care. They went into that line because it makes them a lot of money. If that business were not profitable, they would have left it long ago.

Money has one effect on people. It can bring the worst out of them. If at some point private health insurers make the wrong business decisions, they could find themselves going bankrupt. When that happens million of people could face being without healthcare and just as with banks, the government (that is taxpayers) will be called in to bail them out.

To me it is not a matter of "if" it will happen but a matter of "when". Health insurance companies are financial institutions, just like banks. They deal with billions of dollars and they hedge positions against the financial markets, just like banks do.

I am convinced that the United States (and the rest of the world) will have to learn the lesson the hard way, just as we have done with banks. Maybe my views are too negative, but considering that the collpase of the banking system has happened several times in the past, I am led to believe that we as human beings repeat the mistakes over and over.

It will take the failure of a big insurer, and people lining up outside their offices demanding for services that the company will not be able to provide because they squandered their customers money out of greed and unwise investments. Is it unthinkable? As unthinkable as Enron collapsing, or the biggest banks in the world begging the Federal Reserve to give them billions of dollars to bail them out.

Is the government any better? That is a good question. Capitalist governments insist on contracting out services, and that makes things more expensive because the contractors called on to provide those services skin taxpayers alive. Then, where there is big money there is big corruption, and government employees can be just as greedy and stupid as anybody else.

Is there a solution? I think that if the government is not able to create a reliable public healthcare system, then there have to strict checks on what healthcare insurance companies do because if those companies fail their customers could find themselves with no coverage at all, and no government system to fall back on. Probably a hybrid system has to be in place, with government and private insurers working together. Unfortunately, at the present time greed is in the way of better judgement and the political environment is in favor of private insurance.

Over the next ten years millions of baby boomers will retire and enter the later stages of life. The pressure on private health insurers will become enourmous as the baby boomer generation ages in big numbers and the cost of providing services skyrockets. At some point the cost will exceed the profits that these companies make from their external invesments. Then these companies will start failing one after the other because for insurance to work, profits have to exceed costs.