Any anti-Obamacare voters expecting a Republican to take over the oval office in 2016 and to repeal all 2000 pages of President Obama’s healthcare overhaul might want to adjust those expectations. That snowball has been set into motion for too long — and has already gathered too much momentum — to be stopped now.
As they say, though, when life gives you lemons, make lemonade. Investors can lament Obamacare, or they can capitalize on it by owning stakes in the companies best-positioned to profit from the changes. Most of the top prospects can be found on the medical-technology and the medical-data arena.
Point of Clarification
Just for the record, it’s not Obamacare that’s creating the real opportunity in the healthcare IT industry. It was 2009′s HITECH Act (part of the American Recovery and Reinvestment Act) — which clarified how many of the electronic record-keeping requirements could and would be met — that’s actually driving the growth in the electronic healthcare records, or EHR, arena.
What’s HITECH? Essentially, it’s mandated improvement in the accuracy of medical records specifically by compelling caregivers, hospitals, and pharmacies to begin using digital medical records. It’s an acronym for “Health Information Technology for Economic and Clinical Health”, if that helps. Of course, the advent of Obamacare — which will successfully complicate the process of getting or receiving care — is setting a bullish stage for the healthcare technology industry’s players. The top prospects within that arena are (in no particular order):
Though nowhere near the top of the average investor’s watchlist, Cerner (CERN) is probably one of the first medical technology names well-versed investors think of. Aside from being one of the biggest with a market cap of $16.65 billion, its revenue and earnings growth have almost been freakishly reliable.
While there’s nothing especially unique working in the company’s favor, its sheer size means it can muscle its way into new markets.
HMS Holdings (HMSY) is, for all intents and purposes, a government watchdog that will almost certainly play a bigger role in billing management once Obamacare is fully implemented.