There's an excellent article in the Washington Post Business section today about the impact of Obamacare on health care sector stocks and investments -- the impact is positive.
In his "(Investing) Advice for Ted Cruz," author Barry Ritholtz lays out facts that the Republicans don't want us to know.
Advice for Ted Cruz
Regardless of Cruz’s fiery oratory or partisan affiliation, after a long day of standing on his feet (21 hours!), when he sits down to review his portfolio, he should put his politics aside for the sake of objectivity. If you want to be smart investors you should consider all aspects of how the insurance mandate of law will affect different sectors of the economy (including the companies within those sectors). This is simply an objective approach.
When the health-care law was passed, my team did just that: We sat down to discuss exactly what impact it might have. Not the politics or the electoral implications, but what result this was likely to have in the real world. We came to several conclusions:
●The nation was going to create up to 50 million new health-care consumers;
●Demand for medical services and equipment was likely to rise;
●Innovative pharmaceuticals, procedures and techniques would also see increased demand;
●Hospitals would no longer be on the hook for free emergency room services, as they have for almost 3 decades.
More good stuff below the squiggle.
His last comment about hospitals no longer paying for "free emergency room services" is further explained:
What’s that you say? Hospitals are mandated to give away free services?One wonders how these serious factors are swept aside in the noise about glitches in Obamacare websites. I guess the facts are too boring
Yes. In response to some earlier bad behavior from hospitals called “patient dumping,” a mandate for unfunded medical care was created and signed into law by President Ronald Reagan in 1986. It said, “Hospitals provide care to anyone needing emergency healthcare treatment regardless of citizenship, legal status or ability to pay.”
That’s right, Reagan created a universal coverage mandate, forced the private sector to pay for it, thereby creating the world’s most expensive, least efficient health-care program. Hospitals hated it, the poor and indigent took advantage of it, and prices were jacked up in response to it. Eventually, the costs spread to everyone else.
Given that history, it is no surprise that hospitals were quietly pleased with Obamacare. After the Supreme Court ruled on the legality of the new rules in June 2012, hospital stocks rallied. It should come as no surprise: They get to remove a huge cost that they had no ability to control. They also get a massive number of new paying customers. And they now have some control over who their patients will be.