> It seems strange to me that you’re saying doctor salaries are too high
I am not. If anything, I think doctors are underpaid. I would not want to spend my 20s and early 30s in that grind, there are easier ways to earn that much money.
> In the case of UNH, how much money flows as an expense on the insurance side into income on the provider side? Isn’t the relative profitability between these two sides an accounting trick?
UNH’s overall profit margins being much less than pure provider groups shows this cannot be a large effect.
>“Less than $50b/yr profit” as if that’s a small amount.
Nominal profit is a meaningless figure when analyzing the pricing power and/or viability of a business. Profit margin is the only figure to look at here, and there are 6 other publicly listed insurers to benchmark to. Additionally, UNH competes with many large non profit organizations, selling essentially fungible services.
> If it’s so stupid to be a health insurance shareholder, then where does that leave their senior leadership and major shareholders? They’re morons for not immediately divesting and moving into fast food, right?
Depends which fast food. Most are probably even shittier businesses, but if it’s McDonalds which has a decent real estate business, then it might be worth moving. However, the execs would earn far more if they were at similar places in other organizations with higher profit margins, like tech/pharma/finance/oil.
Obviously, if you can’t get a job at Alphabet/Eli Lilly/JPM/etc, then you stay with insurance and earn whatever you can there.