GE Boosts Outlook for Health Business –

GE Boosts Outlook for Health Business –

The medical equipment market will be an interesting one to keep an eye on as legislation changes. For the past few decades, it’s been an easy market to make a profit in because cost concerns have been alienated from health care decisions.

As legislation changes, hospitals willingness to invest in special equipment will change. If we move in the direction of more of the same, hospitals will be more willing to buy equipment that will allow them to recommend superfluous tests to patients so they can bill the insurance companies, Medicare, etc. If we move in the direction of Canadian policy where spending is limited and therefore health care becomes first-come-first-served, we will see a fall in equipment purchases.

We will also see a continued growth in demand for GE’s products abroad as other economies strengthen and as more and more Americans are forced overseas to get health care.

One response

I think demand for hi tech equipment is going to drop in the US in the next few years. The loss of docs under Obamacare will lead to waiting times and rationing. Caps on hospital reimbursement will constrain capital purchases. It may become like Canada where they run equipment until it is obsolete and the repair parts are no longer manufactured.

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