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Vital Springs Technologies Dr. Sreedhar Potarazu on the health-care law’s impact on potential consolidation of the industry and how it will affect c...
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Yeah that's striking a deal to -- Coventry Health Care today.
And the move will help -- grow its government business from 20% to more than 38%.
Seems a Smart move considering the new healthcare -- calls for -- -- up on government based health plans.
But this is actually an end up taking more money out of your wallet joining us now -- issued.
Rotten news bite us bring that technology CEO it is great to see you as always -- That I have me back let's talk about this this -- there is a business decision or a political one.
Well I think it's a business decision in response to a political want to visit.
So.
You know not -- -- -- you had WellPoint insignia that made some pretty big acquisitions to get into the government market.
And -- got to do the same that's where the money is there under a lot of pressure with the implementation of the new law.
To spend more on patient care to take on more people.
With preexisting conditions.
So a key way for them to drive revenue.
It's for commercial companies in the private sector to go after the government market and that's Medicare and Medicaid.
So that's it the expansion of Medicaid and Medicare is really where the money's gonna be in the health care sector is an.
Well absolutely I mean if you look at Paul Ryan's proposal in terms of driving more competition.
In the Medicare market as one proposal for trying to reduce cost if you look at the states.
That have to expand their Medicaid rosters at least the ones that choose to comply.
There's going to be a lot of activity in terms of the commercial insurance carriers.
Getting into that market in terms of getting more covered lives but.
The flip side of that is.
That they're also getting a lot of pressure from hospitals.
-- raising their rates for insurance companies.
And so you're seeing a number of these dynamics role in that are forcing the insurance companies to start.
Gobbling up the smaller ones.
What can we start seeing that right WellPoint agreed to buy Amerigroup -- for four point 46 billion last year.
Seeing -- right -- and agreed to buy -- -- so we're seeing cannot consolidation in the industry right.
At the end of the day though does not mean less choice higher costs for us at home.
Well you got a currency that's exactly what's happening you know we tried to go after this.
Raising more competition.
To try and keep price is competitive but.
Doesn't take much to figure out exactly what you -- when you start consolidating the market.
And you don't have much choice anymore -- creating monopolies.
Will then they start to dictate price so this is what they're doing by.
Forming you know small you know bigger insurance companies by some of them coming together.
The insurance companies themselves are out there acquiring.
-- hospitals or doctors practices.
So that for the average consumer watching today what we're trying to push them to get more choice.
In reality a few years from other gonna help last Tories and higher cost.
You mentioned Paul Ryan's plan to give vouchers to purchase private carriers in things like that do you actually think that would work.
Well you know there was -- study that was published in the journal of American Medical Association.
That validated when they looked that.
Medicare Advantage vs Medicare.
In terms of whether -- that kind of system would work.
Lo and behold the results were rather shocking.
To the Harvard economist some of them Obama supporters.
That Medicare Advantage actually did better than standard Medicare.
So there is actual evidence to show.
That that kind of system can work the second thing is is that if you look at the corporate sector.
Many employers today have used that model of defined contributions.
Giving a set stipend or a set payment.
Two employees -- -- buy health insurance so it's not a new concept and there's enough evidence now coming out.
To say that that could actually work in terms of writing competition.
And bringing down costs.
It's really interesting that prior to Paul Ryan's nomination we were barely even talking about Medicare Medicaid and now sun it's -- center again.
Mean do you think that we're gonna carry this -- all the way to the polls -- -- hitting an hour.
Absolutely it is and there's no question that you're hearing a lot since the announcement of Paul Ryan and about whose plan is actually going to be the one that ends up winning the votes in November.
I think that the one who is able to defend.
That math behind.
The Medicare.
Solution.
How seniors will not be able to not lose Medicare will actually be able to pay for it.
And keep the country solvent.
And not become bankrupt because of Medicare.
Is going to be the one that ends up winning at the ballot box in November.
Have -- read about that that's a big thanks to be -- us -- extra.
