DK - letter: Values of Health Care Stocks Increase Fearlessly as Public Option Is Dead

[Mira]

From my in box a letter from Dennis Kucinich:

Wall Street Celebrates Senate's "Significantly Watered Down" Health Care Bill

Dear Friends,

Wall Street is celebrating "Health Care Reform." According to an industry insider report yesterday by MarketWatch (Gibson and Britt) health care stocks rallied as the bill moved through the Senate, particularly since there is no public option in the bill to compete or compare with insurance company rate-making.

"Health care investors find themselves having confronted their greatest fear, and, while there will be legislation, it will be significantly watered down ..." said Mike O'Rourke, chief market strategist at BTIG LLC. As a result, shares of Aetna gained 4.7%, while Cigna rose 3.9%. United Health and Wellpoint "rallied to 52-week highs."

Once the bill becomes law, insurance companies will gain at least 26 million new customers and as much as $50 billion in new annual revenue from private-pay and from government subsidies as people will be required by law to purchase private insurance. While certain expenses are capped in the bill, it appears that premium costs are not.

The Senate's move prompted Gregory Nersessian of Credit Suisse to raise his price targets on seven insurers: Aetna, Cigna, Amerigroup Corp., Humana Inc., Molina Healthcare Inc., UnitedHealth Group Inc. and Wellcare Health Plans Inc.

" ... the is a positive first step" Nersessian said in a note to clients. "The heavy lifting will come when Congress is forced to slow the rate of medical cost growth through more aggressive payment restrictions and utilization controls down the road," he said - meaning that this particular industry insider is predicting limitations on benefits.

Marketwatch also wrote that none of the new standards on how much the industry must spend on medical expenses will "impose great hardship on any insurers."

Tomorrow: My analysis of the health care legislation as it currently stands.

Sincerely.

Dennis Kucinich

[Aramchek]

1. I laughed when I read 'Sincerely'

give it a rest, Dennis.
Nobody cares what you think.

[ixion]

2. well, gee, now that's not really true at all is it...

I, for one, care, and I know many other DU'ers who care as well.

[Aramchek]

6. sorry. the majority doesn't care what he thinks. feel better now?

[Donnachaidh]

4. pull off those jackboots and rest your brain

The shrill chorus of STFU is wearing thin.

[Aramchek]

7. the shrill chorus of 'It's ok to side with the Repukes as long as we're principled' is disgusting

[ixion]

8. I see... so you believe being unprincipled is better

oh yeah, that makes all the sense in the world. :eyes:

[Aramchek]

9. I never said Dennis or his chorus actually had principles. They just pretend to.

By his vote, you can't tell any difference between him and a Repuke.

In fact, Cao of LA proved to be a more reasonable person than Kooch.

[dana_b]

11. then just put your fingers in your ears

"LA LA LA LA LA LA!!"

[Aramchek]

13. while you shake hands with the Repukes?

[rudy23]

10. I laughed when I saw "Aramchek" as the first response to a DK thread.

B/c it totally proves my point and it's typical.

[ixion]

3. An easy way to confirm: Reintroduce the Public Option

and watch the stock fall like the House of Cards they really are.

[onenote]

5. cigna dropped today. does that mean something changed?

Or does it mean that once again people are attributing more to how the stock market reacts to things than is probably warrnated.

[Mira]

12. Look at this screen shot and see what Mr. Kucinich is talking about

http://www.google.com/finance?client=ob&q=NYSE:WLP

(and try to ignore Aramchek - he thinks it's his post and it is not)

[phasma ex machina]

14. Says it all.

:applause: for Kucinich, one of the good guys.

[dixiegrrrrl]

15. I hope you will post tomorrow's letter from him also.

Very glad you shared this.The more information the better informed I feel.
K&R.

[Mira]

17. I'll post it as soon as I get it, I'm always more than interested in what Mr. Kucinich adds

to the debate.

[Mari333]

16. knr