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Tuesday, Mar 28 2017

Full Issue

As Big Beneficiaries Of ACA, Hospital Stocks Jump On News Of Replacement Defeat

The stock increases stood out on an otherwise dour day for the markets, as investors fret that President Donald Trump's failure to push through the health care overhaul bodes poorly for the rest of his economic agenda.

One for-profit hospital in south Texas scrimps on scrubs, blankets, mops and employee overtime. A nonprofit in Boston is fighting to preserve its world-renowned academic research program. The future for both hospitals remains uncertain.  With the failure of the Republicans’ overhaul of the Affordable Care Act, hospital administrators from every corner of the U.S. have been breathing a sigh of relief. But the respite will likely be short-lived. True, 24 million Americans won’t be losing their insurance, a fact that has investors buoying hospital stocks for now. Even so, the industry is up against market forces that will compel hundreds of hospitals to shrink, remake themselves or even close in the months and years to come. (Lauerman and Greifeld, 3/28)

Monday’s climb in hospital stocks continues a rally that began last week, as the Trump administration and House Republicans failed to win support for a bill to dismantle the ACA. House Speaker Paul Ryan on Friday canceled a vote on the legislation, conceding it lacked enough Republican backing. Hospitals benefited from more paying patients under the Affordable Care Act, most notably in states that expanded Medicaid. (Evans, 3/27)

Shares of U.S. hospital operators surged on Monday after Republicans' pulled their healthcare bill, preserving for now the benefits that hospitals gained under Obamacare. (Krauskopf, 3/27)

This is part of the Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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