Trends 2009: Healthcare No Longer Recession-Proof

Monday, November 10th, 2008
This post was written by Melanie Matthews

It’s the dawn of a new administration…and with the campaign promise of the “Change We Need,” the healthcare industry will be a major focus for President-elect Obama.

When we gathered the day after the election for our fifth annual Healthcare Trends and Forecasts conference, Dr. David Chin of PricewaterhouseCoopers’ Health Research Institute reflected upon the historical election results and the fact that for the first time, the healthcare industry is no longer recession-proof.

“The fact that President Obama has been elected does not change the federal deficit. Obviously, everyone’s focused on the economy as the number one issue, and there’s going to be a lot of deficit spending associated with bolstering the financial system, which does not leave a lot of dollars available for healthcare.

“…With Obama coming into office, his approach is clearly to adopt more of the Massachusetts model….The net effect has been a real reduction in the uninsured. Massachusetts’ uninsured has dropped from 10 percent to 5 percent with the advent of the Massachusetts Health Connector program, and the Obama plan has many similarities to that. But that does not mean there will be more monies, because …they’ll take money out of the disproportionate share payments…so there will be essentially a zero sum game in terms of net new reimbursement.”

Fewer available healthcare dollars and a dip in consumer discretionary healthcare spending will certainly fuel wellness and retail healthcare efforts, two other 2009 industry trends discussed at length by Dr. Chin and co-presenter Perry Hanson, partner with Wipfli, a national accounting and business consulting firm. In case you missed last week’s “look ahead at the industry,” you can still benefit from their insight via an on-demand re-broadcast, CD or DVD.

In addition, this week’s Healthcare Business Weekly Update has an audio interview with Dr. Chin.

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