On Saturday, the House of Representatives took big steps in overhauling the nation’s healthcare system. Now the pressure is on Senate Democratic leaders to follow suit, as President Barack Obama puts new pressure on Democrats in Congress to finish their work on health care before the year is up. Will related exchange traded funds [ETFs] stand to gain?
We are about two steps away from health insurance reform in America, says Obama. Stephanie Condon for CBS News reports that Democrats in the House managed late Saturday night to pass their comprehensive healthcare bill by a vote of 220 to 215. Meanwhile, 39 Democrats voted against the bill, even after adding to the legislation a strict anti-abortion measure intended to earn the support of moderates.
Don Dion for TheStreet reports that even as public support for the healthcare bill wanes, there’s hope yet for the sector’s ETFs. (Why healthcare reform still looks good). The downward trend for providers could reverse as voters turn their backs on the ambitious healthcare overhaul. Voters are apparently dissatisfied with Obama’s policies. (How has health care affected ETFs so far?)
On the other hand, if healthcare reform goes through, some ETFs could see their holdings change as some constituents are legislated out of existence by the new laws.
As the health insurance and health care industry stand to gain from about tens of millions of customers, the industry is still complaining. Duff Wilson and Reed Abelson for The New York Times report that insurers do not like the idea of a government-run insurance program. Drug makers oppose billions of dollars in rebates they would have to give to the government over 10 years. Meanwhile, medical device providers would have to give a 2.5% tax to the government on their products. Also, employers large and small oppose rules that, for many of them, would make health care coverage — long a job benefit — become a federally-mandated obligation.
For more stories about health care, visit our healthcare category.
- iShares Dow Jones U.S. Health Care Providers (NYSEArca: IHF): up 26.9% year-to-date
- PowerShares Dynamic Health Care Services (NYSEArca: PTJ): up 10.3% year-to-date