Fifth Annual Wall Street Comes to Washington:

Originally published by the Center for Studying Health System Change (HSC). HSC was a nonpartisan policy research organization funded principally by the Robert Wood Johnson Foundation.

Fifth Annual Wall Street Comes to Washington: Market Watchers Evaluate the Health Care System

Conference Transcript | June 21, 2000

The fifth annual "Wall Street Comes to Washington" roundtable, organized by HSC, brought together leading financial analysts with deep expertise in health care sectors to examine recent and emerging trends shaping the industry. As in previous years, the event assembled professionals who tracked the business strategies, supplier relationships, competitive dynamics, technological developments, consumer preferences, and regulatory environment affecting the companies they followed.

Roundtable Participants

The panel featured Dennis Farrell, Managing Director at Moody's Investors Service; Norman M. Fidel, Senior Vice President at Alliance Capital Management; Roberta Walter Goodman, Managing Director at Merrill Lynch; Joy M. Grossman, Associate Director at the Center for Studying Health System Change; Geoffrey E. Harris, Global Head of Corporate Finance, Health Care Division at Warburg Dillon & Read; and Samuel W. Murphy III, Vice President and Senior Security Analyst at American Express Financial Advisors. Paul B. Ginsburg, President of HSC, served as moderator.

In addition to their broad market knowledge, the panelists brought specialized insight into managed care, pharmaceuticals, hospital operations, and information technology. They also spoke to Wall Street's reading of current and proposed regulatory actions, including a patients' bill of rights, a potential Medicare prescription drug benefit, the effects of the Balanced Budget Act, and medical privacy legislation. Broad industry trends -- such as the possible turning of the insurance underwriting cycle and the trajectory of premiums -- rounded out the agenda.

HSC president Paul Ginsburg moderated the discussion among the panelists, while Joy Grossman offered evidence from HSC's own research to either support or challenge the analysts' views. A summary of the panelists' remarks and a question-and-answer session with the audience followed.

Topics Addressed at the Conference

Managed Care: Did moves by United Healthcare and other plans signal a shift toward a softer, more consumer-friendly style of managed care? Were class action lawsuits altering plan behavior? How steeply would premiums climb in 2001, and what forces were behind the increases? Were insurers or consumers benefiting from plan consolidations, and what could be learned from these experiences?

Pharmaceuticals: What was fueling prescription drug price increases, and how were employers adapting? Which new drugs were approaching regulatory approval, and how would they affect prices, patients, and the industry? Under different policy scenarios -- government price-setting versus a competitive framework with lighter intervention -- who in the industry stood to gain and who stood to lose?

Providers: Were hospitals and physicians gaining ground against health plans, and if not, why? What was the financial picture for hospitals, and what roles had the Balanced Budget Act and managed care contracting played? How were struggling hospitals responding to these pressures? Was the growing focus on medical errors changing provider behavior?

Information Technology: How were the internet and web-based technologies being deployed across the health care industry? What was the outlook for business-to-business e-commerce in health care? What challenges stood in the way of building e-health systems to support insurer-provider and provider-consumer interactions? Would the fundamentally local character of health care delivery change as internet use expanded? And how concerned were providers about the costs of implementing privacy safeguards?

Sources and Further Reading

Kaiser Family Foundation -- Employer Health Benefits Survey -- Annual data on employer-sponsored health insurance.

Health Affairs -- Peer-reviewed health policy research.

Robert Wood Johnson Foundation -- Health policy research and programs.