Love and Money

Health care providers recently sent a love letter to the Obama administration. During Clinton-era reform attempts, they protested fiercely and loudly. Now they're pledging fervent loyalty.

"The times demand and the nation expects that we, as health care leaders, work with you to reform the health care system," wrote a group representing hospitals, health insurance companies, doctors, drug makers, medical device makers and labor. They pledge to simplify administrative costs, make hospitals more efficient, reduce hospitalizations, manage chronic illness more effectively and improve health care information technology. (Wall Street Journal)

Why all the love?

The Obama administration is intent on reducing cost increases in the American healthcare system by $2 trillion over the next decade. And this time the political and public support seem in place to make it happen. Suddenly, a lot of money is at stake, and the healthcare sector is a strong performer on Wall Street. 

Average Stock Performance (Equal Weight)

Compound Annual Growth Rate between 2006 and May 15, 2009

Diagnostics  +07%

Big Pharma  -05%

Hospitals  -06%

S&P 500  -13%

Big Managed Care  -14%

(Thomson One, 5/15/09)

Cupid has many muses. For the love of money, maybe a little kumbaya will finally make reform a reality.

—Tom DeSanto

Image: www.sarahbaingallery.com