The Great Health Insurance Scam
How Employers Were Hijacked to Cover Routine Care — and Why It’s Crushing Consumers, Doctors, and America
Health insurance was never meant to run healthcare. It was meant to insure against catastrophe — not micromanage routine care. What we have today isn’t insurance. It’s a trillion-dollar healthcare control system and health insurance is working exactly as designed.
Insurance’s Original Purpose Has Been Hijacked
- Insurance exists to protect against rare, unpredictable, financially devastating events
- It was never designed to pay for routine, predictable, affordable expenses
- Car insurance doesn’t cover oil changes or tires — health insurance should be no different
- Covering routine care destroys price signals, invites corruption, fraud, and inflates costs
- Health insurance fraud drains billions of precious healthcare dollars from the U.S. healthcare system
- Modern health insurance abandoned risk protection and became a payment-controlling middleman
Covering Routine Care Was the Original Sin
- 80–90% of all healthcare is routine office-based, or outpatient
- These services are generally affordable and price-shoppable
- Insurance coverage of routine care: Eliminates competition, Encourages overuse, Requires endless rules and bureaucracy
- This single design flaw birthed: Prior authorization, Referrals, Narrow networks, Denials, Delays, and Rationing
- The result: assembly-line medicine, not patient care
A Third of All Healthcare Spending Is Pure Waste
- U.S. healthcare spending now exceeds $4.5 trillion annually
- Roughly $1.4 trillion (≈33%) is wasted on insurance-based administration
- This money funds: Billing departments, Coding manipulation, Utilization review, Marketing, Denials, and Appeals
- None of this improves health
- It exists solely to control payments and behavior
Publicly Traded Health Insurers: A Built-In Moral Conflict
- Most major U.S. health insurance companies are publicly traded corporations
- Their legal duty is not to patients — it is to shareholders
- This creates an unavoidable, structural conflict of interest between: Patient welfare, Profit maximization
Shareholders Come First — Patients Come Last
- Public insurers are judged by: Share price appreciation Earnings growth Dividends and buybacks
- Wall Street rewards: Cost denial, Care delays, Administrative rationing
- There is no financial upside to paying for more care
- There is upside to denying it
Executive Compensation Exposes the Truth
- The CEOs of the eight largest publicly traded health insurers rank among: The highest-paid executives in the world
- Their compensation is tied to: Profit margins, Cost containment, Shareholder returns
- These rewards are funded by: Denials, Underpayments, Administrative obstruction
- This is not healthcare leadership — it is financial extraction
Profit Over Patients Is Not a Bug — It’s the Business Model
- Public insurers succeed financially by: Restricting access, Limiting utilization, Narrowing networks, Delaying approvals
- Patients are not the customer
- Employers are not the customer
- Physicians are not the customer
- Investors are the customer
Health Insurance Has Failed Every Promise
- It has failed to control costs
- It has failed to improve population health
- It has failed to prevent medical debt
- It has failed to protect autonomy
- Premiums rise faster than inflation while coverage thins
- Health insurance costs significantly impact the overall prices of goods and services
- Health insurers use risk pools so healthy individuals subsidize the costs of the less healthy
- Most insured Americans never meet their deductible
- Record insurer profits prove one thing: systemic over-insurance
Paying for Junk Science While Denying Necessary Care
- Insurers routinely: Deny medically necessary care, Delay time-sensitive treatments, Label care “experimental” to avoid payment
- Yet they pay for many tests and treatments lacking irrefutable, reproducible evidence for safety and benefits
- “Standard of care” is: A legal construct Not a scientific standard
- Stunningly, physicians accepted this definition
- Insurers then weaponized it through guidelines and coverage rules
Healthcare Decisions Are No Longer Made by Doctors or Patients
- Non-physicians employed by insurers approve or deny care
- Prior authorization overrides clinical judgment
- Formularies dictate prescriptions
- Visit quotas restrict time with patients
- Algorithms replace individualized care
- This is bureaucratic rationing — not medicine
Market Forces Work — When Insurance Is Absent
- In healthcare sectors free from insurance dominance: Cosmetic surgery, Fertility care, LASIK, Weight-loss medicine
- Prices stabilized or fell
- Quality improved
- Innovation accelerated
- Transparency increased
- Proof that insurance interference inflates costs
The Government–Insurance Complex: Rules Written by Insurers, for Insurers
- Insurance dominance did not occur organically
- Vote-seeking government lawmakers crafted and voted on healthcare rules
- It was engineered through: Lobbying, Regulatory capture, Revolving-door policymaking
- Insurers also helped draft laws that: Locked in their middleman role, Eliminated competition, Preserved opaque pricing
- Insurers were not regulated — they were empowered
Catastrophic Insurance Was Deliberately Gutted
- True insurance should cover rare, expensive, unpredictable events
- Lawmakers, urged by insurers: Restricted catastrophic plans largely to people under 30, Forced older adults into bloated, overpriced plans
- This eliminated affordable options for healthy adults
- The intent was clear: force enrollment into higher-premium products
Referral Systems and Prior Authorization Were Designed as Barriers
- Insurers crafted rules requiring: Primary-care gatekeepers, Referral dependencies, Pre-approvals for routine services
- These mechanisms: Delay care, Increase overhead, Strip physician autonomy
- They do not improve outcomes — they ration utilization
HSAs: A Financial Product Masquerading as Empowerment
- HSAs were marketed as “consumer-directed healthcare”
- In reality: Insurers partnered with financial institutions, Banks profit from account administration and investment spreads
- Contribution limits blunt their usefulness
- HSAs became adjuncts to insurance dominance, not an escape from it
Open Enrollment: Artificial Scarcity by Design
- Open enrollment periods are unnecessary for routine healthcare
- They: Create gaps in coverage, Penalize life changes, Trap consumers in bad plans
- Miss the window? You wait — even if you need care
- This is not protection — it’s administrative coercion
Fear-Based Marketing and Broker-Driven Sales
- Health insurance marketing relies on: Fear Exaggeration Half-truths
- Slogans imply: Financial ruin without coverage, Better health with insurance
- Plans are often sold by commission-driven brokers
- Low-value freebies mask: Narrow networks, High deductibles, Limited access, Subpar health plans
- Consumers are sold — not informed
Legal Price Fixing for Insurers, Illegal for Physicians
- Insurers can: Collude with hospitals, Set artificial “allowables”, Control market share
- Physicians are legally forbidden to do the same
- Prices have nothing to do with cost or quality
- This is state-sanctioned price fixing
Taxpayer Dollars Used for Private Gain
- Insurers receive billions in public funds: Medicare Advantage, Medicaid administration, ACA subsidies
- Profits are skimmed before care is delivered
- Care is then rationed
- Some administrative work is outsourced offshore
- Tax dollars enrich shareholders — not patients
Take-It-or-Leave-It Contracts for Everyone Else
- Insurance contracts with: Employers, Consumers, Physicians
- Are one-sided and non-negotiable
- They include: Gag clauses, Payment clawbacks, Coverage exclusions
- Violating insurance rules means financial punishment
- This is economic coercion, not partnership
Physicians Reduced to Corporate Labor
- Over 77% of physicians are now employees
- Employed by hospitals/health systems and private equity (PE) firms
- Pay tied to: Volume, RVUs, Coding output
- This is not value-based care, it’s patient exploitation
- It is a massive financial conflict of interest
- The doctor-patient bond has been sacrificed
Insurance Rules Are Driving Burnout and Collapse
- Prior authorization consumes 14+ hours/week
- EMRs prioritize billing over care
- Payments are discounted, delayed, denied, clawed back
- Defensive medicine is rampant
- Burnout, early retirement, and suicide rates are rising
Medical Debt Happens With or Without Insurance
- Deductibles, copays, and exclusions bankrupt families
- Surprise bills persist
- Being “insured” is not financial protection
- It is a false sense of security
The PSA Example: Paying for Harm, Not Benefit
- PSA screening fails to save significant numbers of lives
- Prostate cancer treatments fail to deliver meaningful mortality benefit
- Yet insurers pay for, promote, and normalize them
- This is institutionalized misinformation — not science
Why This Health Insurance Model Is a Moral Failure
- Healthcare depends on: Trust, Professional judgment, Individualized decision-making
- Public insurance companies depend on: Algorithms, Denials, Scale, Bureaucracy
- These values are incompatible
- A system that profits from not delivering care is ethically indefensible
Why This Disqualifies “Medicare for All” Run by Insurers
- Expanding coverage through the same profit-driven entities: Does not fix the problem It entrenches it
- Medicare Advantage already proves this: Profits extracted first, Care rationed afterward
- Scaling this model nationally would: Institutionalize denial, Eliminate autonomy, Centralize control
- A for-profit insurer cannot be the steward of universal care
The Bottom Line
- Publicly traded health insurers are: Financial institutions, Not healthcare organizations
- Their incentives reward: Shareholders, Executives, Administrative growth
- Not: Patients, Physicians, Health outcomes
- A system built on these incentives cannot be reformed
- It must be structurally dismantled
The Way Out: Insurance for Catastrophe, Cash for Care
- Reserve insurance for: Hospitalization, Major medical, Catastrophic events
- Major medical coverage will be more affordable and allow more consumers to be covered
- Use direct pay for routine care and eliminate health insurance fraud
- Expand HSAs and tax deductibility
- Restore price transparency
- Reintroduce market forces
- Your body. Your care. Your rules.
Final Reality Check
- The U.S. healthcare system is moribund
- Employers and taxpayers cannot sustain it
- Insurance-based medicine is economically and morally bankrupt
- The solution is not more regulation - It is less insurance, not more
- Insurance plan value-based healthcare is a myth
- Someone once said that insanity was doing the same thing over and over and expecting a different result. There’s no better example of such misguided thinking than the insurance-based control of routine healthcare
More Material
Visit the HEALTHdrum YouTube channel where we separate medical fact from medical fiction in routine healthcare.
How The Medical Profession Was Hijacked/LinkedIn
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