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Love it or hate it, Obamacare got a huge reprieve yesterday when the Supreme Court issued its favorable ruling on subsidies. The program is the uncontested law of the land now — and will remain so for the foreseeable future.
And love it or hate it, the health-care merger wave got a huge boost when the uncertainty created by the Obamacare debate went away. The only thing that might alter its course would be a major political change in the White House and/or Congress during the next election cycle.
I understand that you have strong feelings about the health-care insurance program. We all do – and I’ve addressed some of those in the comments section below.
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| The Supreme Court saved Obamacare, which will lead to a health-care investment bonanza. |
But since this is an investment newsletter, I can’t help but talk about the market implications of those two major developments. In a nutshell, they create a health-care investing bonanza!
Think about it. Several million more Americans have already joined the nation’s insurance rolls, and millions more will follow in the next couple of years. That means more individuals seeing doctors, getting operations, going for medical tests, and taking pharmaceuticals to treat chronic and acute conditions.
Not only that, but Uncle Sam (and by extension, all of us) is now going to be footing the bill for millions more patients at America’s hospitals. Instead of having to write off the cost of treating poorer patients, which they can’t turn away by law, those hospitals will have their bills covered by subsidized insurance. Result: Bad debt costs will keep falling.
| “The ruling clears up a massive amount of uncertainty.” |
Finally, the ruling clears up a massive amount of uncertainty about future subsidies, enrollment projections, cost forecasts, and more for the insurance industry. That means they can go on their merry way merging with each other, and otherwise expanding their business of providing Obamacare-compliant plans.
For Safe Money subscribers, I anticipated many of these developments. They’ve been invested in two health care/hospital stocks for a while now, and they exploded in value yesterday – one due to rampant merger speculation (which cooled a bit today) and another because of the bad debt/patient implications of the Supreme Court ruling. I also added another Big Pharma play recently that could be one of the next stocks to run.
Whether you’re a subscriber to an investment service or do it all on your own, now’s the time to focus on the health-care sector and do your research. These latest developments tell me we’re on the cusp of a health-care investment bonanza.
So what do you think? Are health-care stocks a great investment here? Or do you believe the Obamacare enthusiasm will fade? What are your thoughts about the Supreme Court decision and the program in general? What do they mean for health care costs in this country? Let me know over at the Money and Markets website.
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Greedy, unscrupulous bankers. The Supreme Court decision on Obamacare. The NeverEnding Greek Story. You came out of the woodwork to discuss these important issues overnight, and for that, I’m thankful.
Reader Jim lamented the Obamacare vote, saying it will only make this country’s health-care cost crisis worse. His take:
“The ACA was written by the insurance companies for the benefit of the insurance companies. Classic crony Capitalism. Wouldn’t you like to have a business where the public was forced to buy your product and have its cost subsidized by the U.S. taxpayer? Free market solutions offer the only possibilities for cost containment. In the current political environment, this will never happen.”
But Reader Susan said she was happy with the outcome, as it will preserve benefits for the less well-off. Her view: “My reaction to all Obamacare subsidies being sustained? A huge, huge sigh of relief! Thank you, SCOTUS, for remembering that behind these laws and debates are men, women (including me), and children (including mine) whose lives are so much better because of the Affordable Care Act.”
Reader Bruce touched on the investment implications, which makes sense given this is an investment newsletter after all. His comments: “With Obamacare (euphemism for socialized medicine) surviving yet another challenge, do you recommend a serious position in our portfolios for healthcare and/or drug company stocks? Doubtless, many investors have shied away because of the uncertainty.”
Great question, Bruce, and I hope my comments in today’s piece help provide some answers. As for the law itself, it has done nothing to hold insurance costs down near as I can tell. If anything, it has made my premiums surge at a larger and larger rate in the last couple of years.
I agree with the principle of helping the less well off and giving them access to decent health care. But if it drives the cost of insurance much higher for everyone, which all evidence suggests it’s doing, it’s clearly not solving the root problem – health care costs too darn much in America!
Meanwhile, Reader Charles offered the following take on the Greek situation: “As if European taxpayers were not taxed to death already, they now support the poor countries. Greece needs bankruptcy. They will never pay back what they owe – stop the pain.
“What the Europeans fear is that Greece will do much better with theirown currency and more will exit the EU. Liquidity will suffer and the other basket cases will see interest rates shoot up.”
On the latest SEC investigation of bankers, Reader Davis said: “Bankers are close to becoming the next group labeled “unAmerican”. That is, over charging and/or selling financial pseudo-products to make profits for themselves at the expense of their clients. On the other hand, this has become so common in America, maybe it is the norm now.”
And on Greece, Davis added: “If Greece fails in paying its debts, getting kicked out of the union and losing access to the euro will only hurt Greece, with little effect on the rest of Europe. And Europe may have done itself a favor in the long run.”
The truth on Greece is that no one really knows what will happen when markets open on Monday if the country is “let go” over the weekend. European policymakers will hope for the best and try to contain the crisis. But they haven’t managed to “solve” the Greek debt situation in the five years they’ve been dealing with it … and that doesn’t exactly inspire confidence, you know?
Didn’t get a chance to comment yet? Have any other thoughts on these very important issues? Then here’s the website link where you can weigh in.
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In a historic ruling for equality, the Supreme Court ruled 5-4 that gay marriage should be legal in all 50 states. Previously, 36 states had given same-sex couples the right to marry. Justice Anthony M. Kennedy wrote the opinion determining marriage was a Constitutional right open to all, saying, “No union is more profound than marriage, for it embodies the highest ideals of love, fidelity, devotion, sacrifice, and family…In forming a marital union, two people become something greater than once they were.”
Will that be enough to placate creditors? It doesn’t look likely, especially because there are still major disagreements about pension obligations, VAT taxes, and other key issues. But we should have a final resolution – one way or the other – by Monday.
Any thoughts on the latest terrorist attack? What to expect out of Greece this weekend? Other stories I might not have touched on? Let me hear ’em over at the website.
Until next time,
Mike Larson
Mike Larson graduated from Boston University with a B.S. degree in Journalism and a B.A. degree in English in 1998, and went to work for Bankrate.com. There, he learned the mortgage and interest rates markets inside and out. Mike then joined Weiss Research in 2001. He is the editor of Safe Money Report. He is often quoted by the Washington Post, Reuters, Dow Jones Newswires, Orlando Sentinel, Palm Beach Post and Sun-Sentinel, and he has appeared on CNN, Bloomberg Television and CNBC.
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How much have you guys had to fork out (Obamacare) since it came into force.Just to give us poor Brits some idea,looks like you guys are going to be a bit poorer.
Re ACA/Obamacare: Dear Reader Susan, remember the job of SCOTUS is not to make law but rather to ‘establish’ constitutionality. Many are cheering; many are not. Regarding ‘better off’, ask those folks who were told they could keep their policies and their doctors and those folks who are now paying much more for much less coverage and those folks who have a new tax. Like much in life, our opinions are jaded by which end of the telescope we’re using.
JUDGE KITHIL: Re: contents of the AHA
** Page 50/section 152: The bill will provide insurance to all non-U.S. residents, even if they are here illegally.
** Page 58 and 59: The government will have real-time access to an individual’s bank account and will have the authority to make electronic fund transfers from those accounts.
** Page 65/section 164: The plan will be subsidized (by the government) for all union members, union retirees and for community organizations (such as the Association of Community Organizations for Reform Now – ACORN).
** Page 203/line 14-15: The tax imposed under this section will not be treated as a tax. (How could anybody in their right mind come up with that?)
** Page 241 and 253: Doctors will all be paid the same regardless of specialty, and the government will set all doctors’ fees.
** Page 272. section 1145: Cancer hospital will ration care according to the patient’s age.
** Page 317 and 321: The government will impose a prohibition on hospital expansion; however, communities may petition for an exception.
** Page 425, line 4-12: The government mandates advance-care planning consultations. Those on Social Security will be required to attend an “end-of-life planning” seminar every five years. (Death counceling.)
** Page 429, line 13-25: The government will specify which doctors can write an end-of-life order.
HAD ENOUGH???? Judge Kithil then goes on:
“Finally, it is specifically stated that this bill will not apply to members of Congress. Members of Congress are already exempt from the Social Security system, and have a well-funded private plan that covers their retirement needs. If they were on our Social Security plan, I believe they would find a very quick ‘fix’ to make the plan financially sound for their future.”
Honorable David Kithil
Marble Falls , Texas
who, when, where, what!!!!!–, why, how; all–Balderdash!
Go to Snopes and type in “Honorable David Kithil”. Snopes finding is that the above is either false or exaggerated.
http://www.snopes.com/politics/medical/kithil.asp
There is one big problem with the Affordable Care Act, aka Obamacare. Although individuals will have coverage either through employment or the open market, doctors and hospitals are not required to accept any insurance. Currently I know of two large medical centers, Cleveland Clinic and Cedars-Sinai in Los Angeles, that limit the insurance they accept to only one company. While researching a primary care doctor in New York City,
I found three who accept no insurance, not even Medicare. I also know, from changing insurance years ago, that the difference in payment is great-for same doctor, same treatment, one company paid $100 and the other company $35, I know this goes against your believes, but this is why a single payer system is needed.
I
The insurance companies are infinitely smarter and more experienced than the academic egg-heads and political hacks who gave us Obamacare. The insurance companies will play along only as long as it is in their collective best interests. When Obamacare collapses under its own weight, the insurance companies will have Plan B ready to go. Ideally, the Republicans will be wise enough to pass enabling legislation that will result in a truly equitable health insurance program incorporating nation wide free market competition and tort free/loser pays attorney control.
How convenient folks like you think the Republicans will save us when Obamacare fails. You do know that Obamacare was written by the Republicans in one of their think tanks. Seriously, both Democrats and Republicans are wholly owned and controlled by the corporations and their plutocrat owners. Neither party gives a damn about you. The USA is doomed because folks like you still believe in the two party system and think one is better than the other.
” A government that robs Peter to pay Paul….. will always get the support of Paul.”
In 1951, there were not any food stamp recipients. Today, 42 million. By supporting people with their basic needs to survive, then those people have the “discretionary” money to go buy cell phones, UHD televisions, and the rest of the spoils that the working class has to labor for to EARN that money. Speaking of the working class, the # of people who actually work has been decreasing over the last few decades. Now, 1/3 of working population takes care of the 2/3 of the non-working population. But, that’s O’Bummer’s dream is to have everyone relying on Government. The GOP may not be perfect, but I’ve always believed in the GOP Manifesto of Laissez-Faire Capitalism-” Abstention by governments from interfering in the workings of the free market.” OR ” A policy or attitude of letting things take their own course, without interfering.”Just think, when America was first discovered, it was harsh! Everyone worked or went hungry. Novel idea….
We seem to be becoming the Divided States. What a moral disaster our court has turned out to be.
I would like to offer a few opinions about the Supreme Court Ruling on “Gay Marriage” I have been listening to a News station for over 8 hours…I truly believe most people are missing the point here…People keep saying its now the Law of the Land…..yet the Will of the People has gone Unheard,true? In many States the People voted or their Legislatures enacted Laws Against it…also true? (this is not the only issue similarly dealt with in the past) Yet.along this legal path….its the Federal courts in many cases that said WHAT the People in Various States had wanted either Through a Popular vote or by their Legislative Bodies was Unconstitutional….Our Legal system seems to be Treating this as a Totally Secular Issue…giving No thought to Ecclesiastical Influences and beliefs in the matter….Its like telling a Jewish Butcher that not only is he REQUIRED to Sell Pork…it has to Be Kosher as well..! As mentioned earlier…this is Not Secular only…watch and see..further Cases will be brought because of Perceived Violations of the Division of Church and State Authority in Realms of PERSONAL Decision Making on one side…vs,…the purported Discrimination against Gay Individuals and Communities on the other…All because Various groups are Approaching the subject from a Platform of differing Viewpoints and Beliefs……in respect towards the Rights to which each Group…Feels ENTITLED. Even….Solomon would have a tough time here,aloha and thanks for reading
Next in the Leftist hit list? Incest and pedophilia! And that horrible symbol of Imperialism and oppression, the American Flag!
Obama care has always been the wrong solution. It is costly and inefficient. What is needed (and adopted by every first world country but us) is a single payer or medicare for all plan which cuts out the insurance companies from the cost equation, reduces paper work, etc. and is far better and cheaper than our mish mash mess with or without Obama care.
We are headed that way. The current system was designed to make us demand single payer.
Greece has a unique situation that they created twenty years ago. They agreed to host an international olympic venue they had no way of affording, goaded by the IOC, who insisted they would benefit from the revenues from venues. Even Greeks of the time knew that the Greek infrastructure would not support such a move, the Greek government went ahead with the venue anyway. Are we surprised with the outcome? Not really. Will the Greek people survive this? Only time will tell.
I question whether the Supreme Court ruling will lead to more medical care being provided to more patients. Any increased access to care by the poor will be offset by less care being sought by those with insurance as the deductibles, often in excess of $5,000, and copays which will increase, will make healthcare unaffordable for the middle class that works and has insurance. They will only seek care when they are seriously ill as the real cost of care will continue to go up dramatically. This is a fools game perpetrated by politicians who don’t have to deal with the cost of the healthcare they have forced on their constituents because their Cadillac plan is being paid for by us, the taxpayers.
The healthcare “issue” is a false problem. The money comes from those ridiculous increase in the healthcare insurance rates. I payed them, and now when I am unemployed is fair to get my money back. And not the healthcare “system” is the end of a big power, but the corruption and the lies of the politicians. When a cancer penetrates a system, there is no way to save it. Already the system does not provide solution but restrictions asked to the citizens. (look at the water “crisis” in California.)
Recent Developments = A Health Care Investment Bonanza; Here’s How to Profit
“Result: Bad debt costs will keep falling.” – Wrong.
Bad debt costs will rise! The huge deductibles that more people are choosing to lower their premiums cause hospitals to chase people who cannot or will not pay. Still hospitals have to treat people who show up at the emergency room even though they may already owe the hospital. You will see hospitals operating in the red and eventually closing because of additional patients who will not pay for non emergency services. You will see longer lines and poorer service at doctor offices. Under-reimbursement means health care providers will work shorter hours and filter patients who are “covered” by government insurance. What would your priority be if you had to divide your valuable time between someone who pays you 50% and another who pays you 100%?
Re: French terrorist attacks. Obviously it only a matter of time before this starts happening in the US. With an uncontrolled border, it is a given as HS is pretty much impotent to stop it. Best advice – stay away from large crowds (football games, music venues, etc) and maintain constant situational awareness. When it happens expect more and more restrictions, rules, and generally unconstitutional actions by our government.
Several weeks ago I told you that you were getting carried away with energy stocks and since then most of them are down, even the one’s selected by the great Boone Pickens! Now you are doing the same thing with hospital stocks that after huge rallies are grossly overbought and overvalued. Wait for a correction before you buy,NOT NOW. The great Jimmy Rogers keeps telling you that you don’t buy any of this stuff at all time highs.THAT IS WHEN YOU SELL!!
Retaining Obama Care, and its leader is nothing short of insane. My vote will certainly depend on how my constituents voted on this issue. Bob Brown
ACA is here to stay. But the bad stuff in it can be and should be changed. Now we have to worry about a Dr. shortage just like Canada has. Physician shortage in Canada is critical due to their health care laws ; 6 months wait to see a specialist. Any U.S. legal kid who’s smart enough and motivated to go to med school should be given massive financial aid.
This madness will soon end but the people in this country will rue the day they
they voted for Obama…Much suffering awaits all of us while this thing plays out…The Supreme Court has just insured the downfall of to US of A !!!
I’m reminded of 1932 when the Conservative who brought the Crash of 1929 and the Great Depression, were screaming (yes, they always scream) that FDR was a Communist and he was going to make thing worse…… Except that things stopped getting worse and started to get better and America experienced the longest and greatest period of Economic Success in it’s history…… Then some 50 years later we forgot the lessons of our Grandparents and we let the Conservatives back in beginning with Reagan…. And here we are, again, having lived through the second 1929, from 2007-2009 under Cheney/bush and here we are digging our way out of the Second Great Depression thanks to those Conservatives and here they are again screaming that Obama is going to make things worse, except, that once again, things are getting better….
Incidentally, for those unaware, Eisenhower, tried to bring us Socialized Medicine during his administration, but the AMA put up such a stink, that it never got through Congress….. Now, all those years longer, we have the most expensive medical system in the world, which is not the best medical system in the world with thousands of millionaire doctors and thousands dying because they can not afford adequate medical care….. Obamacare will take us to Socialized Medicine, just like Medicare has for those over 65 and we will be better off for it…….
I was disappointed on both Court decisions this week. Both only further weakens our
country. What I am sure about however is that decisions made by the opinions of
men do not change what God the Creator has set in motion. Marriage is ordained
by God between a man and a women. The true essence of Marriage.
Affordable Health Care will never help any of us rich or poor because those who work
to pay will not be able to keep up with those who take. Our priorities in this country I
love are perverted. But alas…God is in Control!