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The Biggest Beneficiaries Of ObamaCare ? Hospitals, Drug Companies, And Insurance Companies

by @ 12:01 pm on March 22, 2010. Filed under Business, Economics, Health Care Reform, Politics

The New York Times finally figures out what most people who gave health care reform more than just a passing thought already knew:

With a sweeping overhaul of the nation’s health care system, Congress would be giving the health care industry as many as 32 million additional paying customers in the next few years.

That would mean millions more Americans buying private health insurance and better able to pay for their hospital stays, doctors’ visits, prescription drugs and medical devices.

And some analysts said as the vote neared that the final legislation was shaping up as much kinder to the industry than many initially feared. Hospitals and drug makers, which supported the final legislation, would be clear beneficiaries, analysts say, even if the outlook for insurers was less certain.


Over all, the legislation would be a positive for much of the industry, said Les Funtleyder, who oversees health care strategy for Miller Tabak & Company, a New York investment firm.


[I]nsurers are expected to benefit from the influx of new customers after years of shrinking enrollments. About 16 million of the newly insured are expected to enroll in private plans. The rest would become eligible for Medicaid, the state-administered program for the poor, but some of those would probably sign up for privately run Medicaid plans available in different states.


Drug makers, meanwhile, may have the most clear reason to celebrate the legislation. Pharmaceutical companies are going to be asked to contribute $85 billion toward the cost of the bill in the form of industry fees and lower prices paid under government programs over 10 years. But they can look forward to tens of billions of dollars in additional revenue as more people with insurance visit doctors and fill prescriptions.

The legislation will also eventually close the gap in Medicare drug coverage, known as the doughnut hole, in which elderly patients must pay for prescription drugs rather than having them covered by the government. Many chose to stop taking their medicine or switched to lower-price generics.

And significantly, the legislation allowed the drug industry to “avoid any of the issues that were particularly of concern — price control or more regulation by the federal government,” said Barbara Ryan, an analyst with Deutsche Bank.

As a result, the pharmaceutical industry has been a significant proponent of the legislation, in sharp contrast to its behavior when the Clinton administration tried to pass a similar overhaul. The industry spent an estimated $100 million in TV advertising, grass-roots organizing and other marketing efforts to promote reform.

Of course, they did this is the best thing that’s happened to them in a long time.

The rest of us ? Yea, we’ll be left with the bill.

2 Responses to “The Biggest Beneficiaries Of ObamaCare ? Hospitals, Drug Companies, And Insurance Companies”

  1. Vast Variety says:

    Wouldn’t it have been nice if there had been, oh I don’t know, an alternative option for people to choose other than being forced to buy this crap from private insurance monopolies.

  2. [...] the time since the health care reform bill became law, we’ve discovered that the biggest beneficiaries of the new law will be the health insurance companies that the Democrats h… that the bill won’t reduce the deficit at all, that the law includes restaurant menu [...]

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