According the Moody’s, hospitals and medical centers could benefit under President-elect Obama’s health reform proposal:

“The expected spending could positively affect the top-line growth of many health care providers,” the rating agency added, noting that the agenda of Obama’s Democratic party includes increasing research funding and providing $10 billion over five years to health care providers to build up electronic-information systems . . .

. . . “The improvement would be direct, through reimbursements, as well as indirect, if more people seek primary-care treatment in a more-appropriate setting such as a physician’s office or a clinic, for example, rather than in an emergency room,” Moody’s said. “This would free capacity and reduce pressure at hospital (emergency rooms), many of which are operating well-above capacity.”

I agree that there may be an initial financial boon as Obama promises to properly reimburse primary care providers. Also with more patients covered, the number of uninsured hospitals have to treat will decrease, which would help with their financial bottom line.

The real cost cutting will come long-term, as the government will have more influence with hospital and physician payments once the majority of the population is insured:

The second step [to cutting waste] would be to extend insurance coverage to the uninsured. This step would increase near-term spending. So it may seem odd to include it in a list of measures essential for cost control. But sustained limits on spending, as distinct from voluntary spending reductions arising from cost-effectiveness studies, will be possible only if nearly everyone is insured.

topics: obama, health reform