Insurance companies just bought themselves a year. Claiming that a proposed tax on health insurance would force them to charge higher premiums, carriers were able to convince senators to defer this particular measure for a year.
This comes as a benefit to UnitedHealth Group (UNH), WellPoint (WLP) and smaller companies writing health insurance policies. Manufacturers of medical devices have won some relief, as well, though the drug business didn't. An earlier plan to tax cosmetic medical procedures was also scrapped.
The tax on insurers was expected to generate $70 billion over the next 10 years, starting in 2010, according to an earlier version of the bill. If enacted, insurers would have seen their profits cut by $6.7 billion, since their rates for next year are already locked in, according to analyst Matthew Borsch of Goldman Sachs (GS).
The deferment of taxes on medical devices until 2011 works out for manufacturers such as Boston Scientific (BSX) and Medtronic (MDT). But the $2.3 billion annual tax affecting drug companies such as Pfizer (PFE) was left untouched.
The $871 billion health care program used to have a provision that would tax non-reconstructive cosmetic procedures. Of course, it drew a considerable amount of fire from the cosmetic medical community and now is no longer in the bill.
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Reader Comments (Page 1 of 1)
12-21-2009 @ 8:28PM
OINKJOHNSON2 said...
Democracy at its very worst--Special interests who have high-influence lobbyists prowling the halls of Congress persuade the elected "whores" we have sent to represent us doing their bidding rather than looking out for the best interests of American citizens. I am thoroughly disgusted, but, living in Las Vegas, with its high percentage of Democrats, have little hope of change. My Representative, Shelley Berkley, is a former cocktail waitress in a casino, where she undoubtedly "performed" better than as a Congresswoman. My Senators, "Lying" Harry Reid, who took one too many shots to the head when he was a boxer, and "Cheating" John Ensign, who could not seem to keep his zipper shut, and then, apparently, tried to buy silence from his mistress and her husband (who, incidentally, was on his Senatorial payroll). America has seen its best days, and, like Rome did, is burning from internal rot. My prediction is that the U.S.A. will be an after-thought in another 50 years. I won't be around, but God help my grand-son.