Nov 21 Democrats in the U.S. Senate cleared the
first procedural hurdle for sweeping healthcare reform on
Saturday by voting to open debate on the historic legislation.
The Senate debate due to start on Nov. 30 is expected to
last for at least three weeks.
Senate Democrats want passage by the year-end but the bill
faces challenges before a final vote. If approved, it would
have to be reconciled with a bill already passed by the U.S.
House of Representatives and approved again by both chambers
before it could be signed into law by President Barack Obama.
The $849 billion Senate bill aims to extend coverage to
tens of millions of uninsured and to cut costs in the
healthcare system, which accounts for one-sixth of the U.S.
economy. The measure looks to several industries to help
Following are some of the health industry winners and
losers based on the Senate leadership's bill.
* The pharmaceutical industry kept its previous $80 billion
agreement with the Senate Finance Committee to provide savings
and rebates, including a $2.3 billion annual industry fee to be
parceled out among companies such as Pfizer Inc, Merck & Co Inc
and others. Wider insurance coverage could help offset the
industry's costs by providing more potential customers.
* Drug companies avoided provisions found in the House bill
calling for greater rebates under the government's low-income
Medicaid insurance program and price negotiation under the
Medicare program for the elderly.
* However, the bill allows an Independent Medicare Advisory
Board to make recommendations to lower Medicare payments for
private drug insurance plans, which could in turn reduce
prescription drug usage.
* Medical devicemakers won a major reduction in an industry
tax to be imposed over 10 years to $20 billion from $40 billion
to conform with the House bill. Devicemakers had fought to
eliminate the tax.
* Hospitals maintained their $155 billion, 10-year deal
accepting lower government payments from Medicare and Medicaid
in exchange for what the industry hopes will be an increase in
* Hospitals, including companies such as Universal Health
Services Inc and Tenet Healthcare Corp, were exempted from
decisions made by the Medicare advisory board, sparing them
from future potential payment cuts.
BRAND BIOLOGIC DRUGMAKERS
* Biological drugmakers such as Amgen Inc, Roche's
Genentech unit maintained their 12-year period of exclusive
sales for brand-name drugs before they would face competition
from generic rivals.
* The bill calls for the development of user fees that
generic biologic drugmakers would pay for the FDA to review
their products. This could put them on par with brand name
biologic drugmakers but could keep some generic companies from
pursuing rival products. Traditional generic drugmakers do not
currently face such fees though they are under consideration.
* Still, the bill would reimburse doctors 6 percent more
for using generic biologic drugs over more expensive, branded
ones, possibly affecting their use among the tens of millions
of Medicare and Medicaid patients.
* The bill includes a government-run health insurance
program but allows states to opt-out of the program, which
insurers see as a competitive threat.
* Insurers such as WellPoint Inc, Humana Inc, Cigna Corp
and Aetna Inc face a $6.7 billion annual industry tax, to be
allotted according to their market share.
* Additionally, insurers would have to contribute to a
reinsurance program to help protect insurance companies against
losses. According to America's Health Insurance Plans, that
would cost insurers $25 billion in 2013, 2014 and 2015.
* Individuals must buy health insurance, but penalties are
likely to be lower than the cost of insurance, starting at $95
a year per adult in 2014 and $350 in 2015. By 2017, the penalty
would be $750 per adult.
* Allows the Medicare advisory panel to make
recommendations on lower payments to both private Medicare
Advantage plans for the elderly as well as private prescription
"Part D" plans. Reimbursement rates for Medicare Advantage
plans, which can offer more benefits than traditional
fee-for-service Medicare coverage at a higher cost, would also
be tied to a competitive bidding process.
COSMETIC SURGEONS, PRODUCT MAKERS
The bill imposes a 5 percent tax on elective cosmetic
procedures such as face-lifts, breast enlargements and tummy
tucks in an effort to raise roughly $5 billion. The excise tax
would be collected by surgeons and other providers and it could
reduce demand for their services. That in turn could cut sales
for companies such as Allergan Inc and Johnson & Johnson's
Mentor unit that make breast implants, wrinkle fillers and
other cosmetic medical products.
PHARMACY BENEFIT MANAGERS
* Companies like CVS Caremark Corp and Express Scripts Inc
must give the Department of Health and Human Services
information about rebates they get from drugmakers for
medications sold through retail and mail-order pharmacies
compared to those through Medicare drug plans.
(Reporting by Susan Heavey; Editing by Arshad Mohammed and