I was going to do a post election special, but Joe Paduda beat me to it over at Managed Care Matters. I was also going to short United Healthcare, given that the Dems win will likely make it rough on those who feed at the trough of Medicare managed care. But of course I failed to do so, mostly because I’m spending all my money on putting in a new kitchen. And of course had I done so, I’d have made out, but again for a different reason. As it turns out, the stock rallied up on Tuesday and then fell Wednesday because the company released news that its problems with the options back dating scandal would be worse than were originally thought.
But longer term, the value health plans contribute when they’re not putting their heads into the Medicare trough seems to be diminishing, and employers seem to be getting wise. If the government (or at least Henry Waxman and Pete Stark) start really asking tough questions, and if Dick Cheney is not the deciding vote in the Senate, which is looking more and more likely, well perhaps the six year bull market in health insurer stocks is over. But I’ve been saying that for a while.
On the other hand, health plans do have some potential to do good. See my podcast with Lonny Reisman of Active Health Management to see what that might be.