All News

September 21, 2023

Hospital Industry Analysts Growing Less Concerned About Affordable Care Act Changes

Hospital Industry Analysts Growing Less Concerned About Affordable Care Act Changes

WPLN | Blake Farmer

Investment analysts who watch the massive hospital industry based in Nashville say the ups-and-downs of the Affordable Care Act are waning. They gave their annual presentation to members of the Nashville Health Care Council on Thursday.

Hospitals were some of the biggest beneficiaries of the so-called individual mandate, which required almost everyone to get health insurance. They effectively got a load of new paying customers. But even with the Trump Administration ending the coverage requirement, A.J. Rice doesn’t expect big changes.

The Credit Suisse managing director has been watching the Obamacare exchanges where people buy their own insurance, mostly with substantial help from the government. The numbers haven’t changed much even though the penalty for not buying insurance is gone.

“That tells me that the only people that are buying on the exchanges largely are people that are fully subsidized or that know they have serious chronic conditions,” Rice said. “So I think we’re at an equilibrium as long as the administration doesn’t do something to further undermine it.”

Leading up to congressional votes on whether to repeal and replace Obamacare, many Republicans argued that the program — especially the exchanges — was in a death spiral.

“I think this worry about the death spiral is probably a little bit exaggerated,” said Frank Morgan, managing director for RBC Capital Markets.

However, the hospital industry is not expecting broad growth. When looking at particular sectors of the health care industry, Nashville’s specialty — which is hospitals — has become less lucrative than segments like medical devices or insurance. Fewer patients are being admitted, in part because of proliferating high-deductible plans. And admissions are a key indicator for investors.

But Josh Raskin of Nephron Research says things may be just returning to the pre-Obamacare pace.

“On a relative basis, it looks worse, because there was this giant bolus of individuals that went through,” he said. “But I think we’re still on the same trajectory — I would argue — that we were before the Affordable Care Act.”

http://nashvillepublicradio.org/post/hospital-industry-analysts-growing-less-concerned-about-affordable-care-act-changes#stream/0

Back to News

Purpose Statement

We exist to strengthen and elevate Nashville as the Healthcare City.

View Purpose