The New Health Care Bill Is Fantastic! For Insurance Companies!

Is there any doubt when you look at the ETF (IHF) for health care providers who has developed the new health care bill? 

The details of the new plan were announced the evening of July 11th.  Looking at this daily chart, Health Insurance stocks spiked the morning of the 12th.  Later that day a couple of Senators said they will not vote for it and the stock prices then dropped the following morning.  Now they are back on the move up again...

And know that the  health care providers ETF (IHF) is up 30% since Trump was elected and the push to repeal Obama Care started.

If I were an insurance company I could not have drawn up a better plan.  Some details:

1.  I may get to sell cheaper plans with out as much coverage.  This means I can remove the low margin parts of comprehensive plans to sell them profitably.  Fantastic, I now have created a new profit area for my insurance company.  I can sell "air" policies.

2.  Now my Insurance company still has to offer more robust plans and cover those with preexisting conditions (which is a large portion of the population).  But that is fine, I can raise base rates and deductibles.  AND, the best part is, the government will subsidize these new higher rates.  So how cool this that, I can charge more on all fronts, and the government (taxpayers) is going to help pay for it.  

This new plan is perfect.  My margins are going up!

Chris Vig is president of The Vig Company and is an investor, artist, writer, business consultant and former CEO living in Monona, WI. This article is for entertainment purposes only.  Do you own diligence when investing your hard earned cash.