What business really thinks about health reform
Posted on 07 August 2010
By Mark Miller
Permanent URL of this article: http://retirementrevised.com/money/what-business-really-thinks-about-health-reform
It seems that the Socialism-fearing business community is more bullish on health care reform than you might think.
Take The Wall Street Journal, for example. The paper trashes the Affordable Care Act every chance it gets, especially on its opinion pages. But tucked away on the “back pages” of its website–in its blog for financial advisers–the Journal this week quotes a former physician turned adviser who explains helpfully:
“The healthcare bill is going to help a lot more than it’s going to hurt. As a financial adviser, it might be a good idea to become familiar with it, especially because certain processes – like applying for the high-risk health insurance – can be complicated. I took the time to read it cover-to-cover, and I’m glad I did.
Carolyn McClanahan is president of Life Planning Partners, an investment adviser firm registered in Florida and Texas. She is especially intrigued by the important new high risk insurance pools, which will be especially useful for older out-of-work Americans who can’t access group insurance plans.
Meanwhile, over at American Chronicle, there’s a nice summary of why Wall Street is bullish on health care reform.
Government takeover” might be a convenient Republican talking point, but the performance of health care stocks and industry behavior since passage of the Affordable Care Act clearly reveal that the talking point has no basis in reality.
The article points out that the market is optimistic even about the future of Medicare Advantage–the privatized PPO option within Medicare that is the cause of so much hand-wringing due to planned cuts in federal reimbursements.
The fate of insurance company Humana is tied to Medicare Advantage: Humana has 15 percent of the Medicare Advantage market, and more than 60 percent of its revenue comes from the program. [Reuters, 7/1/10] Even with changes for Medicare Advantage plans starting in 2012, Humana Chief Executive Officer Mike McCallister recently said, “Medicare is actually a very good place to be… Medicare is going to be a very big business in the future, we´re very well positioned, so we´re feeling pretty good about where we are.” [Reuters, 7/1/10] Humana plans to get back to the Medicare Advantage program’s original intent with something it calls the “15 percent solution” – administering its plans at costs 15 percent below the cost of traditional Medicare. In analyzing the future of private insurance companies participating in Medicare Advantage, John Gorman, chief executive of a consulting firm focused on government-sponsored health program, remains “very bullish” on the program. [Reuters, 7/1/10]
Bottom line: The political rhetoric on health care reform is off the rails, and out of touch even with the viewpoint even of the private health insurance sector.
