Predictions 2011

Predictions 2011: Bertha Coombs on Health Care


1. Congress won't repeal health reform.

The Republican-controlled House could pass a bill repealing the Affordable Care Act, ACA, but Democrats retain the majority in the Senate, making it virtually impossible for a repeal measure that could survive a presidential veto.

But watch for a rollback of the ACA tax-reporting provision requiring small businesses to file a 1099 form on expenditures over $600. Repeal of that measure has seen has bi-partisan support.

2. A lot of noise but mixed action in states.

The legal battle lines in the states will likely align behind the Florida v. HHS lawsuit challenging the constitutionality of ACA. Expect a federal court ruling in 2011 to lead to an appeal that stretches well into 2012.

At the same time, states will have to decide whether to forego federal funding for expanding Medicaid, community health centers, bolstering state insurance regulations and setting up insurance exchanges. How many will really say no to federal money?

3. Insurers won't see big hit from health reform MLR in 2011.

Health insurers received waivers on low-cost, mini-med plans that don’t meet ACA requirements.

HHS will also allow states to provide insurers exemptions to new Medical Loss Ratio, MLR, spending requirements in the individual and small business insurance markets, making it look less likely managed care providers will be on the hook for big rebates in 2012.

Patent expiration on major drugs like Pfizer’s blockbuster Lipitor in 2011 will continue to fuel pharmacy acquisitions, but watch for consolidation in health care facilities and services, too.

The ACA calls for so-called Accountable Care Organizations to create more streamlined and cost-effective integration of care. Hospitals are buying up clinics and forging new alliances with physicians to qualify for ACO status, which could mean higher rates and bonuses if they're shown to improve quality of care.

5. Chinese health reform will drive growth.

Though China’s overall spending on health care lags the west, Beijing’s ambitious plan to rebuild its health care system by 2020 will continue to fuel investment in hospital expansion and medical equipment, presenting a double-digit growth opportunity for major equipment makers like General Electric , parent company of CNBC, Siemensand Philips page90phgfalsetrue43pricetruefalsefalsefalse0QuotefalsetrueChartfalsetrueNewsfalsetrueProfilefalsetrueAdd to Watchlistfalsetruetrue the market also poses huge growth potential for the pharmaceutical companies. Chinese spending on prescription drugs is expected to grow more than 20 percent year over the next decade, according to data firm IMS Health, making it the world’s fastest growing market.