The U.S. Supreme Court’s decision Thursday to uphold the Affordable Care Act has created ripples throughout Missouri’s healthcare system, and many businesses in the state believe there are more to come. One such ripple was felt right away: Several state healthcare-related businesses saw sharp increases in stock prices while other companies saw declines.
The Affordable Care Act creates a national insurance system making coverage required and more accessible for all Americans as well as a requirement.
Thom Gross, an Express Scripts (ESRX) spokesperson said the company wasn’t sure if insuring more people would increase sales for the pharmaceutical company.
“It’s hard to calibrate how Express Scripts will be affected,” he said. “We definitely support the idea of having more people covered by health insurance.”
But the company’s stock rose 2.4 percent following the ruling, going from $53.50 at close of market Wednesday to $54.79 Thursday.
Insurance companies, on the other hand, did not fare as well. Kansas City Life Insurance’s stock fell by slightly less than 1 percent. Well Point, which operates the largest insurer in the state, Healthy Alliance Life Insurance Co., saw its stock fall by more than 5 percent after the Supreme Court’s ruling.
Nonetheless, Anthem Blue Cross Blue Shield’s Missouri Public Relations Director Deborah Wiethop said the company supported the law.
“From the early days of the debate on health care reform we’ve stated our desire to build a healthcare system that provides access to all Americans and ensures high quality, affordable care,” Wiethop said.
Although many insurance company stocks fell, Centene’s stock rose by more than 2 percent. Unlike other insurance companies, Centene Corporation (CNC) focuses on providing insurance for low-income individuals. The company recently received a contract from the state of Kansas to provide insurance for needy families, pregnant women, the elderly, people with disabilities and long-term care beneficiaries.
Reinsurance companies, which purchase insurance from other insurors to reduce their risk, experienced fallout from the ruling, too. Reinsurance Group of America’s stock rose 1.17 percent after the Supreme Court’s decision. A spokesperson from the company was unsure how a new insurance exchange might affect business.
“It is premature to answer questions about the ruling and its effect on our business activities, but we continue to monitor the changes resulting from it and expect to respond as we always do – by providing our clients with innovative products and services that help them succeed, and by providing superior knowledge and insight in mortality and health risks,” RGA Senior Vice President of Health Care Reinsurance Michelle Fallahi said.
According to a New York Times article, hospital stocks generally performed well nationally. Two of the biggest hospital chains in Missouri are nonprofits and don’t trade stocks—CoxHealth in Springfield, one of that city’s largest employers with hospitals, and BJC in St. Louis, one of the biggest nonprofits in the United States and operates Barnes Jewish Hospital—but spokespeople from each had something to say about the ruling nonetheless.
CoxHealth CEO and President Steve Edwards said via email that the act isn’t a cure-all; people need to eat and live healthier, too.
“The underlying problems with health care remain regardless of the United States Supreme Court decision,” Edwards said. “Across our nation, state and federal budgets are broke and the number of uninsured continue to grow at alarming rates. Our population is generally unhealthy, compared to the rest of the western world. Obesity and smoking plague our nation. The trajectory of the cost curve and demand driven by lifestyle choices require us to reorient and redesign the delivery of healthcare.”
BJC Healthcare Vice President of Corporate and Public Communications June Fowler said the act, coupled with aging Baby Boomers, will allow companies to add jobs. She also said the act will change the way BJC does business.
“People who lack insurance will often delay care,” she said.
As a result, she said people could end up in the emergency room who could have saved money by seeking preventative care.
Fowler said the company will have to increase the amount of preventative care it offers, but she said costs for the overall system won’t rise as a result. BJC also plans to increase outreach so people know about preventative care.
“When we have people come to the emergency room for non-emergent reasons we try to connect them with physicians,” she said.
Some companies believe the ruling is only the beginning of healthcare regulation, including private Kansas City insurance broker Lockton, Inc. Mark Holloway, a Lockton compliance service employee, said some companies might have been in a holding pattern until the decision was announced.
“Employers who were sitting on the fence, not entirely embracing all the changes and strategic thinking required by reform, will have to engage…quickly,” Holloway said. “Employers will need to begin making significant strategic decisions within the next several months.”
The individual mandate and health insurance exchanges are currently unregulated, but according to a press release Lockton’s position is that this will change.
“Regulations, particularly on the employer mandate, will be very complex,” Lockton employee Edward Fensholt said, “and we can expect a crush of complex guidance compressed into a very short time.”
As a result, even after the Supreme Court’s decision, some businesses might still be unsure about the law’s implications.
“Next stops on the health reform train include distribution of four-page plan summaries, W-2 reporting of health plan values, limits on health flexible spending accounts, new income and capital gains taxes on executives,” Fensholt said. “There remains plenty to do.”