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To: Johnny Canuck who wrote (33005)	6/22/2001 12:40:04 PM
From: Logain Ablar	Respond to of 70275

Hi Harry: I think drug companies will be impacted by the medicare leglislaton (this is a different piece of leglislation which may be next year, not this year but I'd say its done before the 2002 election recess for the campaigns) which is going to have some sort of price cap on drugs. Most HMO's try to get the same price as the gov't so initially this will be a negative for the companies but I would bet the drug companies can work around it. I actually like companies like immunex in the drug space (not yet price wise). The flip side though on my healtcare comment. HMO's evolved in the 80's when the insurers and the indemnity plans were unable to contain costs. Under indemnity plans the Dr's and hosipitals would over treat (hey the more test, visits, etc. the higher the revenue). [For those who forget an indemnity plan was where the insurer sold the medical beneift product to the employer and the typical plan covered 80% of the medical expense, with a deductible and cap, cap bing after a certain point the insured didn't have to pay the 20%. Many plans, like the auto unions had 100% coverage from the get go.] At first the employers absorbed the costs but we are talking 8 to 13% premium hikes when inflation was 3 to 5%. HMO's started the restrictions (shorter hosipital stays, less treatments (especially when statisticly it was shown some treatments were worthless) and more accountability where you just had bad doctors and hosipitals. Not saying everything a HMO did is good or was right but people forget about the runaway medical costs in the 80's (of course most was born by the employer which is why they forget). now the pendulum is swinging the other way and the government will intervene. projections are premiums will rise 2 to 5% (depending on which version) and in my experience these projections are always understated. I think we should have the right to sue for a hmo screw up but there should be caps. The arguement is there are no caps elsewhere and if there are caps the attorneys don't have the incentive to take on the case. Damned if I know the best answer. Best Tim