If you work in insurance, then it should be even more clear to you.
Notice I didn't say all companies were good ones.
How do insurance companies make money? How do they decrease costs and maximize profits?
Risk/Premium ratio, the best way to explain it is, the more people sharing in the risk, the less people have to pay, as long as liabilities stay under what is being charged in premium. Insurance companies reduce costs by first having a negotiation position with caregivers, this is as simple as saying "the check will be on time, we just want a good rate" and honoring that promise, the second thing is to deny unnecessary or uncovered care, this is all stated explicitly in writing, if the contract isn't honored, people have legal recourse. Also, insurance companies....every single one of them, reinvest to cover gaps in earnings, as well as many companies re-insure, that is, they buy smaller contracts to further spread out the payout so as to keep prices as reasonable as possible compared to liabilities.
In the Auto Insurance World, they do so by attempting to attract driver's with unblemished records and cancelling policies on those who are determined to be liabilities.
Health works in a similar way, but if a contract in health puts in a coverage maximum(lifetime) then one can't be dropped at a whim, or at least they will know when they are claiming too much.
The same is true of Health insurance companies. If health insurance
companies authorize every procedure that a Doctor recommends a patient have, that is going to increase their costs and thus decrease the amount of profit that they bring in for their CEO's and shareholders.
see above.
It is this incentive to ration healthcare, deny recommended procedures, deny insurance to those with pre-existing conditions, and seek to deny claims that cut costs and increase profits.
Procedure denial happens for many reasons, not just because a company doesn't want to pay, if a doctor explains that a denied test was medically necessary, more often than not a company will cover it, it's usually when a doctor doesn't explain that something which looked like he was padding a bill in fact was an appropriate action.
Do you seriously not see the inherent flaw/contradiction in such an archaic and asinine system?
As opposed to a government system which would essentially do the same thing without having to justify their actions in civil court?