Bush Is ‘Business-Friendly’; But Pressures Exist for Changes to Health Care System
Bush will take office next month "uniquely poised" to influence America's health care system, which is "deeply fissured" with providers declaring bankruptcy and Medicare managed care companies exiting the market, the Los Angeles Times reports. Other pressures to change the system exist, such as rising medical inflation that promises to increase the number of uninsured to 48 million by 2009 as small and mid-size businesses become reluctant to shoulder the costs. A "meltdown" that may occur if HMOs and other health plans continue to struggle could create additional pressures to change the health care system. In addition, Bush will face a complicated legislative agenda, which insurers "staunchly" oppose but is supported by Democrats, expected to be at the top of the list.
Despite these pressures, investors are still betting that Bush will lean away from imposing a large number of regulations, as the stocks of drug companies, HMOs and other health care companies have "rallied sharply" since September in anticipation of his victory. Although Bush has reiterated his intent to assist seniors in purchasing prescription drugs not covered under Medicare, he has not articulated whether he would push for legislation that would "significantly" affect the number of uninsured in America. Bush's proposal on this matter was "modest" compared to Vice President Al Gore's, relying predominantly on tax incentives to help purchase private insurance (Bernstein, Los Angeles Times, 12/15). Furthermore, Bush's proposal to give seniors money to purchase their own health coverage is favored by the industry because it would expand private insurance. But health insurers shouldn't "count their blessings" yet, HIAA president Chip Kahn said, adding that health plans "are under the gun on so many issues that on any given day we may be a winner or a loser" (Weisman,
USA Today, 12/15).
Finally, the Times speculates on the extent of Bush's role in implementing health care policy, saying that "it has been Congress more than presidents" that has directed changes in health care policy. Banc of America securities analyst Todd Richter said, "There's only been one president in history who tried to influence health care, and that president -- Bill Clinton -- failed miserably." In light of Clinton's "botched" effort to implement reform, HIAA's Kahn suggested that the next administration avoid trying to "overhaul" the entire health care system, but focus instead on health insurance as a "separate issue" (Bernstein, Los Angeles Times, 12/15).
Meanwhile, a Bush victory gives the tobacco industry "ample cause to cheer" -- not only for the incoming "business-friendly" president, but also for the antitobacco one they "narrowly escaped," the Times reports. After enduring the policies of Bill Clinton, who "flailed them like a pinata on the issue of underage smoking," tobacco companies are looking forward to Bush's "more amicable approach." Some of the changes tobacco companies can look forward to include:
- The possible dismissal of the Justice Department's "massive" tobacco suit. Bush has criticized the suit, leading to "wide anticipation" that a new Justice Department would dismiss the case or seek a settlement.
- Waning pressure to increase cigarette excise taxes.
- A diminishing likelihood that the FDA will impose tougher warning labels and "ground rules" for marking less harmful cigarettes.
Wall Street investors are also anticipating the change, evidenced by the sharp rise in tobacco stocks, including those of Philip Morris, R.J Reynolds Tobacco Holdings and Brown & Williamson. But industry officials are "taking pains" to stifle their "glee" in public. Peggy Roberts, director of corporate communications for Philip Morris, said, "We are more than happy to work with the new Congress and the White House on a variety of issues. But we were happy to work with whomever won." Still, antismoking advocates have acknowledged the challenge that lies ahead. Stan Glantz, a "prominent" antismoking activist and professor at the University of California-San Francisco medical school, said the Bush victory is "bad news for us, and party time for tobacco" (Levin, Los Angeles Times, 12/15).
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