This is the second part of three on Obama Care. I am using it from the Senior Housing Forum. While I believe in a free market system and I am dessappointed that the law was upheld, I know there should be some changes. Fraud is rampant and with the increased healthcare rolls, I see more targets for fraud. There should also be some way that medicines are kept at an affordable price. I am currently taking one pill that costs about $60 per pill. That is about $1,800 per month. Now the drug company can charge whatever it wants but it is easy to see how many people choose between medicine and food. I truley hope Obama Care isn’t as bad as I anticipate it will be. Read below for some more info.
On Friday I talked about the winners, in light of the Supreme Court ruling. Inevitably if there are winners, there are losers. Thursday will close out the series talking about the specific implications for senior housing.
The Losers
1. Taxpayers – It has been said that, in effect, this is the single biggest tax increase ever implemented by the Federal government. Hardest hit will clearly be the middle class. Initially, it is clear the Affordable Care Act will add to the tax burden. What is less clear is what savings, if any, will be achieved, when they will be realized and if they will save money for the middle class as promised.
2. Drug Companies – In the short term, the drug companies have created an agreement with the government that, in effect, protects their bloated profits. The jury is still out on how long it will take for that agreement to crumble, but it will. For consumers, this is a mixed bag. Over time it will eliminate derivative drugs that are expensive but provide only marginal real benefits to patients. On the other hand, it will likely dampen the innovation of new drugs that could radically improve life.
3. Durable Medical Equipment Providers (DME’s) – Several times each year a story on Medicare fraud splashes into the news. Probably seven out of ten times, the fraud, involves DME providers. One government study indicates more than 10% of all DME dollars paid out are for fraudulent claims. We can look forward to ObamaCare coming down hard on DME. If all they do is reduce fraud that is great, but look for real claims to also be denied and delayed.
4. Physicians – There is ongoing pressure to reduce payments to physicians. They are an easy target as the general impression is that they are wealthy and by extension, overpaid. There is no doubt that some specialities can still make practitioners wealthy, but in truth, being a physician generally means a very nice living but it is no longer a guaranteed path to wealth.
5. Consumers – A few weeks ago I had a significant allergy attack. After a day of trying to push through it, I was nonfunctional. First thing in the morning I called my primary physician and had an appointment for later that same day. I got to my appointment on time and maybe 3 minutes after paying my co-pay I was ushered into the physician exam room and 3 minutes later the physician was there to see me. This happens because there is competition and significant reimbursement. I do not expect it to stay this good. There are already so many stories coming out of Canada and England of individuals having to wait weeks for a physician appointment for even serious (but not immediately life threatening) problems and long waits when the appointment day finally arrives.
Too Early to Tell
1. Skilled Nursing – There is no doubt that skilled nursing communities must continue to fight to protect their funding. Both Medicaid and Medicare dollars are at risk. I predict that within 10 years every single recipient of government healthcare dollars will receive their benefits through an HMO like entity. This will likely benefit top notch facilities and make life more difficult for the rest.
It is my view that, in reality, Skilled Nursing faces essentially the same problems with or without ObamaCare.
2. Home Health – This one is really difficult to predict. It seems clear that Home Health actually provides the most bang for the buck and it feeds the instinctual desire people have to age in place. The flip side is that, home is a pretty easy target. Recipients do not speak as a single voice and providers are almost as equally fragmented.
3. Hospice – Ditto Home Health.