The passage of the historic US Healthcare Bill , touted as the most sweeping U.S. health-care legislation in four decades , and as was pointed out by a Nobel Prize-winning economist as “a victory for America's soul” paves way for a reformed insurance and health care system that works not just for the healthy and the wealthy, but for all Americans.
It promises to provide healthcare coverage to nearly 35-40 million more Americans at a cost of close to a $ trillion ensuring every citizen in the US has access to quality, affordable health insurance. The law also includes an array of provisions to strengthen the coverage of those who already have insurance.
The legislation will expand the medicaid government programme for the poor to cover those up to 133 per cent of the federal poverty level, and offer subsidies for millions of other Americans to buy insurance through an on-line exchange offering policies at more-affordable group rates.
At the same time the increased acceptance of generic drugs in the US, particularly after the recently-passed Health Bill, opens an increased market opportunity for Indian pharma since the Bill promotes the use of generic drugs that are often one-tenth the price of the original version, but has the same impact. The Indian cos offer the most economical prices compared with multinationals according to some analysts.
Indian drug makers could see major growth for the next seven to eight years bolstered by exports to the US and also due to the fact multinational firms may now be willing to put more money for buying India’s formulations companies,which would translate into huge opportunities, said industry experts.
While generics form only 19-20 per cent of the US market today, they are likely to make up nearly 46-47 per cent by 2013 when the bill will come into full effect.
Among the 14 countries named in the Congress discussion that can offer low-cost drugs to achieve lower healthcare costs, India and China were the only two that have enough scale to serve the US market. Hence the Indian drug makers will gain significantly by the passage of this bill given the fact that they already supply to the US market,they opine.
India has the largest number of US Food and Drug Administration approved pharma plants outside the US. Howeverr they point out that the opportunity for large Indiandrug makersrs may get limited if global giants such as Pfizer and GlaxoSmithKline grow their generic formulations businesses aggressively.
Even if large global companies decide to enter into the business, Indian large-caps will have an advantage for almost four to five years after the bill comes into effect by 2013, because others will be catching up in scale.
Hence it will be crucial for large Indian pharma to capitalise during this time to better business models and get ready for higher competition,they aver.
Besides the supply of drugs, the other sectors that will also tap into larger opportunities because of the healthcare overhaul are information technology services, insurance providers and medical transcription companies, they point out.
Indian hospitals too see greater opportunities, as patients may be directed by insurance companies to India in an effort to keep medical costs under control. And the requirement of technicians, nurses, etc, for the US market, could again see an increase in numbers, as the Bill looks at providing healthcare access to more people, they add.
Though it is a jumble of measures and still a long way from the kind of health benefits the citizens of most other developed countries enjoy, it is certainly a step in the right direction.
The nonpartisan Congressional Budget Office (CBO) confirms the legislation fulfils Obama's pledge that health reform must be fully paid for and not add a dime to the deficit. In fact, the law will reduce the deficit by $143 billion in its first decade, and by a whopping $1.2 trillion in the second decade.
The new law in coming months will crack down on abuses by health insurance companies that currently leave most Americans just one serious illness away from bankruptcy. Among other things, it immediately creates a high risk pool programme to help provide coverage to people who are uninsured because of pre-existing conditions, and eventually will ban outright the practice of denying coverage due to pre-existing condition.
It will stop insurers from cancelling the policies of people who get sick. It bans lifetime caps on benefit payments, and tightly limits annual caps. And it ends discrimination against women, who now pay premiums up to 48 percent higher than premiums for men.
It makes health insurance affordable for the middle class and small businesses - the largest tax cut for health care in history - reducing premiums and out-of-pocket costs.
It gives millions of Americans the same private insurance choice members of Congress will have, through a new competitive health insurance market that keeps costs down.
It improves medicare benefits with lower prescription drug costs, better chronic care, free preventive care, and nearly a decade more of solvency for Medicare. The prescription drug "donut hole" will be reduced and eventually eliminated.
Many employers with more than 50 workers that don’t offer coverage will be subject to a penalty. The reconciliation bill will change the penalty to $2,000 per worker, from $750 in the Senate bill, and subtract out the first 30 employees.
In addition, the law includes a a broad array of provisions promoting wellness, prevention and public health. The aim is to accelerate America's transition from the sick care system at present to a genuine health care system.
With the passage of the Bill, many of the woes of the American healthcare system will be sorted out. Healthcare has now been extended to about 95 per cent of the population and helps to lower projected budget deficits. The Bill restricts the ability of insurance companies to deny coverage on grounds of pre-existing conditions, or that payout limits have been reached. It provides for tax subsidies to help individuals and small businesses purchase insurance and also penalties for those who don't. . It creates a national marketplace for insurance. It also provides for the possibility of tort reform.
The healthcare reform is truly historic and owes its success almost entirely to Mr Obama getting behind it with single-minded commitment. As was the case with Social Security in 1935 and Medicare in 1965, health reform was passed by Congress in face of stiff opposition.
Generations of Americans will look back on it as something that made an unparalleled contribution to raising the quality of their lives and along with it their productivity and prosperity.