- Market Commentary -

February 11, 2010 (FinancialWire) (By Bob Farley) — It’s interesting that while government-enforced health-care reform was more possible than not, a lot of health stocks and indexes went up. Now that most pundits are getting ready to hammer the nails into the coffin of that reform, the stocks are down and companies like Wellpoint Inc. (NYSE: WLP) and Community Health Systems (NYSE: CYH) are scrambling to figure out how they’re going to entice the estimated one in five Americans without health insurance to buy into the scheme.

And let’s be honest, how many Americans who pay for all or part of their insurance are happy with it? Many still get hit with gigantic bills for uncovered portions of operations and procedures. If the company is paying all the premiums, those uncovered portions are slightly more palatable, as much as any unexpected bill can be.

Many drug companies are facing the cessation of their drugs’ patent protection. If they haven’t got other drugs in the pipeline or already on the market, they’ll be seeing drops in revenues. They wanted that extra 20 percent of the population to be forced onto the insurance rolls. Those people need drugs, if not now, maybe someday. Doctors need sick people to treat, and insurance companies need fit and healthy people to bet on getting sick so they can pay for the people who do wind up sick.

But how solid a plan is eyeing the currently uninsured for a lifesaver? What’s going to happen a few years down the road? The same thing. The “sickness” field will soak up all the new people it can, dole out all the drugs and procedures it can, and again have to search for new methods of protecting the bottom line.

Look for big companies to get bigger, thereby allowing themselves to negotiate lower costs to themselves. Call it the Arkansas Approach after another conglomerate giant that has proved that bigger is better for bottom lines.

But while drug companies, hospital operators, and insurers rush to keep themselves afloat and profitable, the best advice to the people they’re nominally called on to serve: Don’t Get Sick!

[Go to http://www.financialwire.net/?s=bob+farley to see more commentaries and articles by Bob Farley.]

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Today in History: Pennsylvania Hospital, the first hospital in the United States, opened in 1752. First session of United States Senate was opened to the public in 1794. Robert Fulton patented the steamboat in 1809. Massachusetts governor Elbridge Gerry first gerrymandered in 1812. King Amadeus I of Spain abdicated in 1873. A sit-down strike ends when General Motors recognized the United Auto Workers Union in 1937. First gold record was presented to Glenn Miller for “Chattanooga Choo Choo” in 1941.

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