Predictions For Health Care Industry In 2008

The Kansas City Star columnist Julius Karash on Mondayexamined PricewaterhouseCoopers Health ResearchInstitute'spredictions for the top eight issues that will affect the health care industryin 2008. Summaries of the issues appear below.

• Medicare: A new Medicare reimbursement system designed to better recognize the severity of patient illnesses could result in decreased revenue for specialty hospitals and other facilities that see fewer acutely ill patients, while urban hospitals that treat sicker patients could benefit.
• FDA: Increased oversight might improve the public's trust in prescription drug safety, but it also could increase the regulatory burden on pharmaceutical companies. The agency now can require drug companies to conduct additional trials after a drug has reached the market.
• Individual coverage: The market for individual coverage "could get much broader" if states and the federal government impose coverage mandates similar to the Massachusetts health insurance law, according to Karash. Individual coverage also could get a "boost" from Republican proposals to provide tax incentives to help consumers purchase individual policies.
• Retail health clinics: The "surge" in the number of retail health clinics "will force states, payers and policymakers to consider the best ways to deliver primary care," Karash writes. Hospitals could benefit if the clinics draw in the uninsured, and pharmaceutical companies might need to increase marketing to nurse practitioners who run the clinics.
• Retirees: "Retirees are playing a greater role in funding their health care coverage," as employers increasingly are shifting the costs to retirees, Karash writes.
• Pharmaceutical companies: Large pharmaceutical companies will continue to purchase and collaborate with life-science companies to improve their product pipelines, but biogenerics could affect drug company revenues.
• Not-for-profit hospitals: New Internal Revenue Service rules will require not-for-profit hospitals to disclose more details about the community benefits they provide, as well as executive salaries and benefits to justify their tax-exempt status.
• Asia: "Asia is poised to become the world's largest pharmaceutical consumer and producer," according to Karash. U.S. drug companies have increased marketing and clinical trials there because of the size of the market, increasing wealth and a "growing awareness of health related issues," Karash writes. In addition, because of inexpensive labor, several Asian drug companies "aim to become worldwide pharmaceutical powerhouses, not just contract manufacturers," according to Karash (Karash, Kansas City Star, 1/14).

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