For years we read in the Wall Street Journal, on the very front page, that American auto companies were making well over $10,000 gross profits on each SUV sold. Americans were more than happy to provide these profits, often paying $40,000 for a vehicle with only $30,000 in parts and labor. No one thought twice about the excess profit levels enjoyed by the auto companies.
On July 31, the front page of the WSJ carried the headline “After Streak of Strong Profits, Health Insurers May See Decline.” The article indicated that “last year, the top seven U.S. health insurers earned a combined $10 billion–nearly triple their profits of five years earlier. The windfall came as insurers raised their prices faster than underlying health costs.”
Kaiser, the state’s largest health-care provider, is a nonprofit corporation, and they work hard to avoid talking about it. But on $30 billion of revenue, Kaiser had a surplus of $1 billion last year, extending a streak of three profitable years with profits of $3.6 billion. According to documents filed with the Department of Managed Health Care, Kaiser has accumulated surpluses of $10.4 billion.
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