Obamacare Part II: The Great Hospital Squeeze

Many people mistakenly believe that healthcare reform is about helping people. Was the GM bailout about helping people? Was Solyndra about helping people? Think about the last thing that Congress did that was about helping people. Most things that Congress does is about helping their supporters, and in this case, the “too big to fail” corporations that supported them. The ones that wanted a “seat at the table”, and were willing to give away the farm for it, are now realizing they were dinner.

Now that Medicaid expansion is an option, we’re seeing the hospitals lobby for it. Not too long ago, they were saying that they lose money on Medicaid. All kinds of bills are floating thinly disguised as “fixes”, most of which have hidden agendas. Follow the money and you will see.

The money trail at MediBid is easy to follow; it goes directly between patient and physician.  There are no other hands to get in the way or take a portion.

Making Money Off of Obamacare

Part II: The Great Hospital Squeeze

On the heels of the Supreme Court decision upholding Obamacare, hospital stocks shot higher. The conventional wisdom is that hospitals, which swallow a significant share of cost of the cost of caring for the uninsured today, will benefit from having a larger number of insured patients and a lesser number of uninsured patients. They are expected to benefit from reduced ER visits and increased compensation for ER visits.

My thesis is that, in the near future, hospitals and hospital chain holding companies are going to be subject to a tremendous financial squeeze that they are ill prepared for. I would suggest shorting HCA Holdings (HCA), Community Health Systems (CYH), Universal Health Services (UHS), Tenet Healthcare Corp (THC), and Lifepoint Hospitals (LPNT).

For full article visit http://seekingalpha.com/article/701801-obamacare-part-ii-the-great-hospital-squeeze?source=yahoo

 

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