Health care reform affects health insurers and businesses alike
On Christmas Eve, the Senate passed its version of health care reform 60-39 and with no Republican backing. With uneasiness in the Democratic party, there are rumors that a few Democrats will change parties, as did Alabama’s representative, Parker Griffith on December 22nd. Despite these reports, the health care reform bill will greatly affect both insurers and businesses alike.
In early January, the Senate will meet to put together the final version of the health care legislation. This final version will then have to pass through both the House and the Senate before finally moving on to President Barack Obama to sign it into law. Some of the differences that will be looked at include the language dealing with restricting abortion funding and the approach that will be used to pay for the health care system overhaul. Although the bill will most likely pass, Republicans have vowed to keep blocking efforts by the Democrats, writes Reuters.
Businesses and health insurance companies both have concern over the final elements that will go into the legislation. Although, both industries show some support. They hope to be able to change some last minute details to their benefit. Health care reform will affect all areas of business and health insurance according to the Wall Street Journal.
The industry that will be most affected is the health insurance providers. The legislation has the ability to disrupt profits. The major source of funding for the proposed health care overhaul would come from Medicare Advantage, which is a privately run health coverage for the elderly. An excise tax on most insurers could cost the industry as much as $70 billion over the next ten years. In addition, with the expected new coverage of the 30 million uninsured, an influx of new consumers, even if they are healthy, will be challenging for insurers as they will likely be heavy users in the early years by attending routine doctor visits.
Consumers who have pre-existing conditions will also be very costly for insurers to cover.
Alarms for the business industry include in the health care reform bill, both the House and the Senate versions, could come years before any measures for change in the health care system goes into effect. Before any cost containment is required for doctors and hospitals, businesses will incur costs years ahead. John Castellani, head of the Business Rountable that represents major corporations, told Wall Street Journal, “The final bill needs to accelerate the delivery-system reforms, and to get rid of the mismatch in new taxes and fees, and the arrival of the measures that will lower costs.” Medium and small businesses have completely denounced the whole overhaul as their costs will be driven up.
As the Senate meets to finalize the last version of the health care overhaul, health insurers and business leaders will work to moderate changes to the health care legislation. It is hoped that the final version that makes it way to President Barack Obama will meet the needs of health insurers, businesses, and the American people overall.