A day after the assassination of UnitedHealthcare CEO Brian Thompson, the New York Police Department (NYPD) has released images that showed the face of the man believed to have killed him outside the Hilton Hotel in Manhattan, where he was supposed to attend the company’s annual investor conference. Investigators believe the shooter may have traveled to New York City from Atlanta last month by bus.

 

Security video showed Thompson, dressed in a blue suit, was walking down the street when the gunman approached him from behind and opened fire. The gunman, who had earlier bought a water bottle and two protein bars from a nearby Starbucks, continued to fire as Thompson fell to the ground. Police, offering US$10,000 for information, say they don’t yet know the motive of the gunman, who remains still at large.

 

But it’s not hard to guess the reason. Former FBI supervisor Rob D’Amico said Thompson’s slaying has all the makings of a personal vendetta tied to the victim’s company. The killer, who used a silencer and wore a black face mask, had deliberately left the clue – words “deny,” “defend” and “depose” written in permanent marker were found emblazoned on the 9-mm ammunition found at the crime scene.

The phrase “delay, deny, defend,” – commonly used by lawyers and insurance industry critics to describe dirty tactics used to avoid paying claims – refers to insurers in delaying payment, denying a claim and then defending their actions. Greedy health insurers like UnitedHealthcare have invited criticism from doctors and patients for denying claims or complicating access to care.

 

Even after a doctor or hospital has determined that a patient needs medical treatment, an insurer, which is responsible for paying the treatment, can still decide that it does not meet its criteria for coverage and refuse to pay the bill. The denial could be in the form of a refusal to authorize the care before it is delivered. But in other cases, patients can be left with hefty medical bills that they must pay out of their own pockets.

 

Hence, it was not surprising when the assassination of the top UnitedHealthcare executive has unleashed a torrent of hate for the health insurance industry, even stunning celebrations in support for the gunman. A discussion forum in Reddit was forced to close after triggering more than 500 responses, mostly critical of UnitedHealthcare – the largest private insurer in the United States.

One said – “He made 11 million dollars while my health insurance went up 12% this year!” Another said – “How does a billionaire feel every time a poor person is killed in a poor area? I would guess no feeling at all or they would work even harder to keep crime in those areas away from his private wealthy playground.” Mocking his wealth, one said – “Well, he was just a bit short of $11M this year. I’m sure his family will be fine.”

 

Mr Thompson was chief executive of his company’s insurance division, which reported US$371 billion in revenue last year (up 15% from 2022) and net income of US$22.4 billion (up 11% from 2022), covering more than 50 million Americans. Thompson received a US$10.2 million compensation package last year, a combination of US$1 million in base pay and cash and stock grants. 

 

“I pay US$1,300 a month in premiums, only to have my claims denied. This man earned millions while people died waiting for approvals,” – posted one TikTok user. One viral post sarcastically said – “Thoughts and deductibles to the family. Unfortunately, my condolences are out-of-network.” One social media user described fighting to secure a specialized bed for her disabled son.

Another TikTok user wrote – “I’m an ER nurse and the things I’ve seen dying patients get denied for by insurance makes me physically sick. I just can’t feel sympathy for him because of all of those patients and their families.” Another recalled battling medical bills after giving birth – “I was sick over this.” Activists argue that current practices – prior authorization requirements and claim denials – place profits above patient welfare.

 

Like it or not, the Thompson’s killing is a wake-up call for the industry. Instead of showing little sympathy for him or the insurance industry, social media have been engulfed in expressions of anger at many Americans’ dire experiences at the hands of health insurance companies and outrage at the large profits that they generate. It shows the growing acceptance of violence as a way to settle civil disputes in the U.S.

 

The greediness was not confined to UnitedHealthcare’s tactic of denying care to vulnerable patients. Thompson himself was part of an investigation into insider trading at the company. Early this year, after the Department of Justice began an inquiry into the practices of monopoly, executives sold US$101 million in stocks, including Thompson, who sold US$15 million, before the public became aware of the investigation.

Public dissatisfaction with insurers has fueled calls for reforms, including in other countries like Malaysia. Already burdened with an endless high cost of living, unaffordable housing, weak currency, low salaries, and the second most expensive country in the world to buy a car, people finally burst into anger after insurance providers sent notices to policyholders about yet another round of insurance premium hike.

 

Beginning next year (2025), medical insurance premiums will rise by 40-70%, which insurance companies conveniently blame for rising cost of healthcare at private hospitals. Mr Hamidi, a policyholder, said – “Previously, I was paying RM188.47 per month, but now I will need to pay RM237.34. Last year, it increased from RM157.69 to RM188.47. The question is, why do the premiums increase every year?”

 

Another policyholder, Safie Wahab, said he might be forced to discontinue his policy due to endless increases in premium. His insurance premium had increased by RM133, from RM244 to RM377 per month. “Eventually, people may no longer be able to afford health insurance, and existing policyholders might let their policies lapse,” – he complained.

Of course, insurance companies always have a list of excuses to justify its plan to raise premiums for obvious reason. Their best excuse has always been escalating hospital billing. In truth, however, both private hospitals and insurance companies are working hand-in-glove to enrich themselves by raising premiums, seeing policyholders as fat cash cows that must be milked vigorously.

 

That explains why hospitals impose different rates for cash-paying patients, credit card users, and medical card users. In 2023, Malaysia recorded medical cost inflation of 12.6%, which is significantly higher than the global average of 5.6%. This is largely due to the excessive charges on medical card users, whose bill could reach RM10,000 in comparison to RM2,000 charged on cash-paying patients for the same treatment.

 

According to the Federation of Private Medical Practitioners’ Associations president Dr Shanmuganathan Ganeson, healthcare providers would greedily inflate costs by performing unnecessary procedures, conducting excessive tests or even falsifying billing codes, often under the pretext of “defensive medicine” in order to make the bill as expensive as possible.

Such dirty tricks contribute to the rising cost of healthcare, which in turn impacts insurance premiums, which is being passed down to policyholders, who have no choice but to pay due to years of perception that private health care is better in terms of services, expertise and shorter wait times than government hospitals, yet “affordable”. Insurance agents also use scare tactics – public hospitals are overcrowded, poorly equipped and incompetent.

 

That’s why neither private hospitals nor insurers are concerned about rising premiums. Their parasitic symbiotic relationship – a scheme that enriches private hospitals and insurers – is also known as a Ponzi scheme. They will never lose money, and even if they do, it’s due to creative accounting rather than actually losing money. In fact, they are making tonnes of money.

 

IHH Healthcare announced a net profit of RM534 million for the third quarter of 2024 alone. Its revenue was a jaw-dropping RM3.68 billion in 2023 (increase from RM3.07 billion in 2022). Meanwhile, KPJ Healthcare Berhad hit an historic RM1 billion quarterly revenue milestone for Q3 this year. For the nine months ended Sept 30, 2024, KPJ Healthcare reported revenue of RM2,871.4 million.

Similarly, Prudential Assurance reported a net profit of RM963.47 million for its financial year ended December 31, 2023, a 68% increase from RM572.16 million the year before. Allianz Malaysia Bhd’s net profit for the financial year ended Dec 31, 2023 jump to RM730.90 million against RM613.67 million the previous year. For the third quarter ended 30 September 2024, Allianz recorded revenue of RM1.44 billion.

 

Clearly, insurance sector isn’t losing money at all. Exactly where do you think the insurance giants make their insane profits, despite shedding crocodile tears that private hospitals have been squeezing money from them through high hospital charges? It’s from the 40-70% increase in medical insurance premiums that they plan to slap on policyholders, of course.

 

To make matters worse, the pharmaceutical industry consistently increases drug prices each year, thanks to the government in allowing monopoly of supply of medicines by cronies such as Pharmaniaga. Since 1994, the government – even after Anwar administration took over in November 2022 – continues to reward Pharmaniaga, extending new contracts worth billions of Ringgit again and again.

Even after the Bank Negara Malaysia (central bank) called upon insurers and takaful operators to reassess its premium-hiking strategy, the arrogant insurance cartel said it could only consider “staggered” medical premium increases – and NOT stop its blood-thirsty scheme. The mighty insurance industry knew that both Anwar government and the central bank are incompetent and powerless against them.

 

The government dares not offend the private hospitals or the insurance companies largely because the stakeholders consist of not only the powerful “elite capitalists”, but also government entities such as the Employees’ Provident Fund (EPF), the Retirement Fund (KWAP), Amanah Saham Bumiputera (ASB), and Tabung Haji. Yes, obviously there is a conflict of interest.

 

The lack of regulation to control private hospitals and insurance companies were by design, rather than by coincidence. They were allowed to operate with little accountability because the government deliberately closes one-eye as it does not want to bear the responsibility of providing health care to the people. The more people go to private hospitals, the less financial burden it would be for the government.

Interestingly, 74.7% of Malaysians were admitted to public hospitals, while only 25.3% went to private ones, according to hospital admissions data. And 15% of these private admissions were paid for by private health insurance – suggesting the massive profits to the tune of billions of Ringgit being milked by private hospitals as well as insurance companies.

 

However, the tipping point could be happening now. As insurance becomes increasingly unaffordable, more people will inevitably turn to public hospitals, putting more pressure on an already overstretched healthcare system. If the government and central bank continue pussyfooting, not only the public healthcare will be at risk, but the public’s frustration and anger could turn against the government.

 

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December 7th, 2024 by financetwitter

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