Ilovebenefits’s Blog

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Equity Research Firm Reacts to Amendments to SFC Bill

Editor’s note: If you would like to begin to understand the impact of the health reform legislation, read these comments from a leading equity research firm, Cowen Equity Research.


  • Raises Health Insurance Fee from $6 Billion Per Year To $6.7 Billion, Representing A Large Portion Of Industry Earnings Estimated At $24 Billion Per Year. Insurers will be able to recoup only a small portion of the fee in premium rates in 2010 as a large portion of their books is already priced. [ED. NOTE: BUT THEY WILL RECOUP THESE ADDITIONAL COSTS IN FUTURE YEARS. GUESS FROM WHOM THEY WILL RECOUP THESE ADDITIONAL COSTS.]
  • Age Rating Band Lowered From 5:1 To 4:1 And Penalty For Families Not Taking Insurance Over 300% Of Poverty Halved. Raises the cost of insurance for younger and healthier members, while eroding insurance takeup among families at higher incomes. Both provisions, taken together, will likely erode the insured risk pool as the economics for being uninsured until there is a medical event become more attractive. [ED. NOTE: APPEARS TO HAVE THE REVERSE OF THE INTENDED EFFECT – HIGHER COSTS, INCENTIVIZES UNINSURED TO STAY THAT WAY.]
  • Lower Threshold For Tax Credits — More Consumers Move From Employer-Sponsored Coverage To The Exchange. [ED. NOTE: YOU WON’T BE ABLE TO KEEP YOUR INSURANCE IF YOU LIKE WHAT YOU HAVE…BECAUSE….IT WON’T BE OFFERED BY THE EMPLOYER ANY LONGER.]
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    September 23, 2009 - Posted by | Federal Government, healthcare | , ,

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