What the Supreme Court Ruling Meant for Health Stocks
We find that upholding the health care law had both positive and negative significant abnormal returns across different sectors. The cumulative average abnormal return over June 28, 2012 and June 29, 2012 was -6.7% for managed care firms (private insurers), -1.2% for biotechnology firms, +0.5% for pharmaceutical firms, +1.9% for health care service firms, and +3.2% for health care facility and hospital firms…
Health insurance companies were hurt significantly following the surprise Supreme Court ruling…In market capitalization terms, this loss is equal to -$6.9 billion in market capitalization. Notably Aetna, Coventry, and Cigna performed experienced the largest decline in their stock prices.
Study here. HT: Tyler.
Uncertainty is powerful in the market, though concrete knowledge is worse.
Back before the PPACA was passed while the bill was first being debated, I spoke at a gathering of engineers and architects that worked in health care construction. At that time they reported that there were hundreds of millions of hospital projects on hold awaiting the final outcome in just this region alone. The said across the country there were probably billions in hospital construction projects on hold. The uncertainty of what hospitals might face was enough to staff projects for several years.
Doesn’t surprise me.
The ancillary costs of compliance are staggering. It’ll only get worse.
We have seen this coming. The Obama administration cannot provide decent medical care without immensely hurting the economy. The Affordable Care Act is destroying the American workforce eliminating job positions that were available before. It will increase the national debt to a point that Americans will have no choice but to change their every day lives and seek a mediocre medical care nobody will even be able to afford if things don’t change…not to mention the impact it will have on the access and quality of care…
More subsidies in the healthcare industry are on the way.
Indeed their poor health is a pbleorm, because their added cost to the insurance pool is the primary driving force of rising American health costs, costs which directly coincide with plummeting national health stats. I have no monetary sympathy for fat people just as I have no sympathy for bad drivers who drive up my auto insurance costs; in fact, in every other form of insurance BUT health insurance, the more risky pay MORE to offset their unfair, added costs to the pool.