Health Insurers plan to Merge. Rates to Rise. We Blew it with Healthcare

[Nuclear Unicorn]

15. Let's suppose there is a business that makes $100 million in revenue annually.

Traditionally they have made $30 million in "profit" but now the government passes a reg that says they can only realize 20% profit so the inattentive say, "Oh. I guess they'll have to put $10 million into production, research, etc."

Except the government also says the public must purchase the company's product and the government has restricted the number of producers able to provide that product, thus eliminating competition.

Suddenly the company raises prices to generate a revenue of $150 million. Well, they still get to take 20% and you aren't allowed to forgo purchasing their product so they're back to making $30 million in profit. Hell, they could raise prices even higher to generate more revenue and the consumers have no choice in the matter.

This was absolutely predictable and when I and others warned of it we were raked over the coals.