Potential Medicare Cuts: Moving These Healthcare Stocks, Not Just Presidential Poll Results
It’s clear that whoever wins in November is going to cut Medicare costs. In the presidential debate, Obama called Medicare “the big driver of our deficits right now.”
Both he and Mitt Romney took pains during the debate to tell today’s elder Americans they had nothing to worry about. But neither had much to say to nursing home or hospital companies -- and they may need to worry.
Bloomberg Businessweek points out that hospitals are counting on $450 billion next year from Medicare and Medicaid. Those include HCA (HCA) and Community Health Systems (CYH). HCA’s president of operations says Medicare contributed almost a third of sales last year, Bloomberg reported.
It’s not like investors can be shocked by the suggestion of health care reform at this point, but you can see that investors responded to the comments made during the Oct. 3 debate.
Only Kindred investors took them in stride. But according to Kindred’s last annual filing, government programs brought in 78% of its hospital revenues last year, 81% of nursing care and rehab center revenues, and 78% of its home health and hospice revenues.