High court health care decision good for some, not others

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The Supreme Court's decision Thursday to uphold President Barack Obama's historic overhaul is expected to boost many players in the health care industry, but not every corner of the sector will benefit.

Drugmakers, biotech companies, hospitals and insurers likely will get additional customers because the law requires nearly everyone to have health insurance or pay a fine, but medical device makers will be hit with a sizable tax on their sales imposed under the overhaul law, without the expectation of boosting sales sharply.

Here's what industry experts, company executives and analysts had to say:

—Now that the court has upheld the law, Michael B. McCallister, the Human Inc.'s CEO, said he wants to focus on improving it. Humana, based in Louisville, is the fifth largest health insurer.

"This is a big bill with a lot of moving parts, and I think we'll continue to move full speed ahead," he said.

— BMO Capital analyst Dave Shove said in a research note that the court's ruling delivered no new surprises for the insurance industry, which has been preparing for the overhaul since it passed in 2010. But the decision does not affect all insurers equally.

"The bad news, for some players, is that the small-group and individual market will remain a tough sandbox to play in," Shove wrote.

—Bernstein analyst Ana Gupte said in a research note that the law will continue to remain "most onerous" for insurers like WellPoint Inc. Shares in Indianapolis-based WellPoint fell $3.59, or 5.1 percent, to close at $65.90 each Thursday.

WellPoint has a relatively high concentration of its enrollment in individual health insurance and employer-sponsored coverage for smaller companies. Those two segments are more exposed to reform restrictions and fees than other parts of the insurance business, such as coverage for employees of large companies. WellPoint is the second-largest health insurer, trailing only UnitedHealth Group Inc.

Gupte said companies like UnitedHealth, which draws its revenue from more diverse sources, will "win under all scenarios."

— Les Funtleyder, a health care fund manager at Poliwogg, a private equity fund for small investors, said: "Hospitals may be the biggest beneficiary because their biggest problem is people without insurance," Funtleyder said.

— The Medical Device Manufacturers Association, a trade group for the industry, said that Congress and the president must repeal the 2.3 percent tax that medical device makers will pay beginning in January. He argues that the tax will make it harder for companies to develop innovative new devices.

"It is clear that this misguided policy has already led to job losses and cuts to research and development," Mark Leahey, the group's president, said in a statement

— Avalere Health, a health research firm, released the following observations on the Supreme Court's decision regarding the law:

"The Supreme Court found common ground in the fact that the requirement to purchase insurance was really framed as a tax. So while the conservatives don't like the mandate and liberals aren't bothered by it, the center of the court agreed that it is permissible to penalize consumers who don't purchase insurance with financial penalties.


  • Legalized gambling
    Insurance is nothing more than legalized gambling and insurance companies are the bookies. It doesn’t matter whether it is health, auto, homeowners or some other type of insurance, it is all the same for my analogy. You are wagering that something bad is going to happen and the bookie is betting that nothing too bad is going to come to pass. So for all you folks out there wondering why insurers don’t want to cover preexisting conditions, the odds are not favorable to the bookie so he doesn’t want to make a bet with you. Nothing more, nothing less. Just because someone is in the gambling business, should they be forced to make a bet? No, they shouldn’t. If you look hard enough, somebody will make the bet but it is going to be at a much higher rate because the odds are worse for the bookie. Insurance companies have nothing to do with setting the prices that healthcare providers charge, the providers set the pricing. If you are mad at how high pricing is, look in the mirror, or at mankind in general. Yes, GREED! Let me explain. Providers set their pricing so they can (hopefully) make a profit on their services. They have to cover their expenses for labor, product they use in providing their services, overhead for facilities and INSURANCE against accidents and malpractice claims. Most do their best to avoid mistakes but they are human and mistakes do happen. So when your neighbor sues the provider and wins $5 million because some overworked doctor left a sponge inside them during a procedure, instead of simply letting them remove it at their expense and perhaps compensate you for the time lost, think about how that huge verdict just impacted the whole pricing structure for everybody and not in a good way. That is why tort reform has been championed by conservatives for years but the news falls on deaf ears.
  • Supreme Court Decision
    I ask the same question over and over...why can't we all have the same insurance tht Congress, and all federal employees have? It's called Tri Care. Not one person has every answered it. It all has to do with money.
  • More expensive and worse care coming...
    Other countries with similar programs do have rationing. Maybe we overuse medical tests in the US, but for those in Canada and the UK, many wait months for MRIs and other tests. Even worse is the long wait for procedures. We are blessed here that if you want to see a doctor, you can. He may not accept your insurance, but he'll squeeze you in. Hospitals mostly accept all comers, regardless of ability to pay. Go to other countries, and you can't get an appointment with a doctor tomorrow. I don't think the new law will be the panacea many people think. If you think dealing with your insurance carrier is a pain now, just wait until it's run like the DMV
  • Support
    I have supported the Affordable Care Act from the start. In 2008, I was admitted to the hospital for Pulmonary Embolism. Come to find out, I have a genetic blood disorder that creates clots. In other words, my blood clots too fast. Well, that explained why the wounds I received in Vietnam clotted off very fast, thus helping to save my life. Well, after paying my hospitals bills, Blue Cross canceled me, claiming I had a preexisting condition that I failed to identify to the company. Regardless of which side you are on, healthcare should not be profit driven. All I have ever asked is for the option to purchase the same healthcare insurance that the Congress, Senate, President, and every Federal Worker purchases. Why is it that some people are denied healthcare coverage while others are not? It is all about profit, nothing more - nothing less. Currently, I buy my prescription drugs from a pharmacy in Europe, because my drugs cost 60% less over there. I asked several pharmaceutical companies how that can happen, and their response was to give $80 Billion Dollars over a ten year period in support of the ACA, and in return, "Reimportation of Pharmaceuticals" will be blocked by the Federal Government. Profits, it is all about profits. Yes, I own stock in every pharmaceutical company, and their dividends help pay for my prescriptions.

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