Monthly Archives: February 2010

Health Care CEO Misleads Using Numbers

Many opponents of health care reform are throwing numbers around, making it sound like the health care industry is barely profitable. They claim a 2-3% profit margin. It’s a half-truth –that 2-3% is, in fact, the percentage of total revenue, which is different from net return on investment. For example, CNN Business lists fortune 500 industries by profit margin of total revenue.

If I make $2 for every $100 I collect in revenue that’s 2%. But if I make $2 million for every $100 million I collect that also 2%.  If my operating costs are 20% of my gross profit (the insurance company average is about 17%), then in the former example my net profit is $1.60, a 400% return on my $0.40 investment. In the latter example it would be $1.6 million, also a 400% return. In both I keep 80% of the gross. In other words, the health care industry’s revenue is ginormous, and its operating costs are low. There’s tons of wiggle room for profit even with having to pay out medical claims.

No one would stay in any business with a 2-3% net return on investment when CD bank rates are 2.85% for a 5 year certificate. With those numbers a business might as well invest its money and do nothing. The real numbers show that the health care industry’s return on share holder equity is 16%. Not a bad return at all. But if you accept the profit margin lie, then the health care companies must be operating at a major loss, which we know isn’t true.

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Conservatives And The History Of Teleprompters

Watch the video and you’ll see David Keene, the chairman of the American Conservative Union, call the teleprompters in front of him “this new technology”. The teleprompters here are glass panels on poles angled so as to reflect the projected words from below. Well, here’s a picture from the 1980’s of Ronald Reagan speaking before British Parliament. Anything look familiar?

One of the reasons conservatives fail so miserably is because they’re not living in the same reality as the rest of us. And they think they’re being clever. How pathetic.

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Ken Ham: The Cartoon – Part 1

The rugged gentleman on the left is Captain Ahab (as played by actor Gregory Peck), the obsessed whaler who hunts down Moby-Dick, the great white symbolic whale. The individual on the right is Australian-born conservative Christian, Ken Ham, the crazed founder of the infamous, Kentucky creation ‘museum’. Is it just me or is there a slight similarity between the two –in appearance and obsession level? If you don’t see it, then just pretend for the sake of the cartoon.

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