Instant View: House gives final approval to health reform

NEW YORK (BestGrowthStock) – The House of Representatives gave final approval to healthcare reform on Sunday, extending insurance coverage to 32 million Americans.

Here are a few responses to the vote:

JEFFREY KANG, CHIEF MEDICAL OFFICER, CIGNA

Kang said the legislation only addresses part of the problems facing the healthcare system.

“That bill really only deals with the coverage issues or the expanded access issues but doesn’t deal with the cost or quality issues,” Kang said. “So you find the expanded coverage is financed by lots of increased taxes.”

KRISTIN BINNS, SPOKESWOMAN, WELLPOINT

“WellPoint is disappointed that after more than a year of debate, Congress has approved health care legislation that does little to reduce cost and improve quality — two important elements to building a sustainable health care system that provides affordable coverage for all Americans.

“We will continue to advocate what we believe is in the best interest of our customers and the country — affordable, quality health care that is accessible to all.

MARIA MENDELSBERG, PRINCIPAL AT CAMBIAR INVESTORS

“Part of me thinks there might be a relief rally that this is over and we don’t have to talk about it any more.”

Shares of hospital companies, which are poised to see more insured customers, and shares of health insurers that specialize in Medicaid in particular could rise on Monday, Mendelsberg said, while shares of other health insurers could fall after rising at the end of last week.

Medicaid-focused health insurers include Amerigroup, Centene and Molina Healthcare.

“All of these moves are kind of more psychological — there’s no financial impact until four or five years from now.”

DAN HUNT, RCM WELLNESS FUND

“My sense is that now that the uncertainty will have passed that investors will be able to focus on the fundamentals. That will create some relief in the sector.”

Hunt said that given the emotional nature of the debate, the initial tick of the market on Monday may be down, but ultimately the sector will rise.

“I think overall we will see some constructive behavior,” he said. “One of the things about the healthcare sector historically has been that it has traded at a premium to the S&P 500. Currently it is trading at a discount, mainly due to this cloud of reform. The removal of uncertainty means that the gap between healthcare and the S&P should close, so I expect whatever happens on Monday and Tuesday, it will ultimately be more constructive than destructive for the sector..”

Investment Research

(Reporting by Lewis Krauskopf and Toni Clarke)

Instant View: House gives final approval to health reform