The likelihood that the healthcare industry will experience significant change has grown stronger in the three months since President Barack Obama took office.  The American Recovery and Reinvestment Act of 2009 (ARRA) passed in February includes more than $30 billion for healthcare related initiatives.  President Obama's fiscal year 2010 budget, recognizing the certainty of increased costs in the Medicare program and anticipating a new program aimed at reducing the number of uninsured, creates a $634 billion reserve to fund government sponsored healthcare programs in the future, almost half of which would come from reduced payments by the Medicare and Medicaid programs.  In addition, many Congressional leaders are as interested in comprehensive healthcare reform as the administration. 

Although passage of healthcare reform is likely, the ultimate nature of reform is not yet certain.  The administration and Congress will focus on a compromise solution during the next few months.  At LECG, we continually research a broad set of healthcare data and policy alternative to better understand the changes that will be made.  Our efforts have led us to identify five megatrends that are likely to influence the future of US healthcare.

This paper describes the five megatrends and their importance.  Expected effects of each megatrend are discussed and an analysis of how they will affect health plans is presented.