Healthcare Matters

After what seems like years of uncertainty (actually only several months), the SCOTUS ruling today relieves a great deal of the uncertainty that has hurt the entire industry –on Wall Street.

Health insurance companies saw their stock prices slip significantly earlier today because investors were convinced the mandate would be overturned. Their prices are now recovering and moving up as I write this post. “Insurers have the most to gain here,” says Bloomberg health care analyst Matt Barry, who wrote that report. “There are a lot of dollars that will be flowing through to them” (by most accounts, about $800 billion more in annual revenues). Not bad. Although the insurance companies have got a lot of accommodating work to do, their fear that the individual mandate would get overturned, and that people would only buy health insurance when they needed it, has been dashed.

Relatively speaking, the significance of today’s decision to Big Pharma is a “big yawner.” Again, according to the Bloomberg Government report, the impact should be about 4% –based on more insured people using their products.  Stock prices among the major players were largely unaffected.

If not the uninsured, it’s the hospitals that care for them that are today’s big winners.  The big for-profits are all enjoying a major spike. No longer stuck with the bills, the Affordable Care Act will resolve “the problem,” by expanding health insurance to about 30 million more Americans –and making insurance companies responsible for their bills. In addition, hospitals that have invested in making the changes required to capture the shared benefits of higher quality care (not quantity), have got to be celebrating.

Regardless of what you think about today’s decision (I’m trying to keep my opinions to myself), the vindication the early adopter-providers must be feeling right now should be shared by all.  We tend to forget that despite the rhetoric, there have been numerous features of the Act that enjoyed bi-partisan support –and care quality versus procedure-driven compensation models is one of them.

—Tom Finn