TRANSCRIPT: Hello. Dr. Keith Smith with you – Surgery Center of Oklahoma. Thank you for joining us in this video blog series.


Let’s break down the ObamaCare scam.


Medical Loss Ratio. This is something many of you might not have heard of. Basically, the medical loss ratio was part of this law that declared insurance companies must spend a certain percentage of the premiums they collect on what is defined as healthcare. This is basically a consolidation move. When the bill was written, there’s no doubt in my mind that this provision was included to create a consolidation of the carriers – of the big insurance companies.


My friend Jim Epstein at Reason Magazine, when I asked him, ‘How do you decide what is a good to story report on,’ he said, “I look for industry consolidation because that isn’t consistent with human nature.” What is consistent with human nature is to have an increasing number of people competing in the marketplace. When you see industry consolidation, Jim told me, that means the dark hand of government coercion, influence, bribery and heavy-handedness is somewhere to be found.


The medical loss ratio has crushed small insurance carriers. It’s made it very difficult for them to compete in the marketplace. After all, if your insurance company is worth or is collecting a hundred billion dollars in premiums and they’re only allowed to spend 20% of that on administrative costs, that’s still a ton of money. If your insurance carrier is much smaller, say a ten million dollar insurance carrier, and you’re only allowed to spend 20% of that on administration, that becomes more difficult and is likely to lead to a consolidation of the industry.


If you follow the news, you’ve seen that every day that goes by, there are fewer and fewer insurance carriers. And this is why. It’s this medical loss ratio. It was created and included in the bill, I believe, deliberately to cause the big players to completely take over the market from the smaller players and create this unnatural consolidation of industry, which only occurs when our good friends in Washington D.C. auction off their votes as they do every day.


Thank you for joining me. We will cover more aspects of this law, parts of which you may not be familiar with as this series continues. Thanks a lot. See you next time.