The Obama health plan: Taxing the rich when there are no rich to tax
The new Obama health care reform package is based on two key programs. One is the taxation of the rich over the next ten years. The other is more competitive bidding among health-care providers that want to get big blocks of business. This bidding process will bring down the revenue that health-care companies are likely to recognize over the next decade.
According toThe Wall Street Journal, "The cuts in health-care spending would affect managed-care companies, prescription-drug manufacturers and hospitals." In other words, it may be a good idea to stay out of stocks in these sectors as their margins are pushed down by the new programs.