Healthcare: Investment Opportunities
Healthcare: Investment Opportunities
Healthcare: Investment Opportunities
Investment Opportunities
Daniel, Eric, Grace, Rebecca, Sunny, Xianming, Natnael, Ryan, Thomas, Zach, Betty, Ariana
Healthcare
Agenda
1.
1 Government Policies
a. Affordable Care Act
b. Government Spending
2.
2 Industry Activities
a. Consolidation
b. Re-domiciles
c. Niche Drugs
d. Recent M&As
3.
3 Investment Opportunities
4.
4 Sector Performance
1 Healthcare
Government Policies
Affordable Care Act Implications
• 11M no longer uninsured (-25%), • Expected increase in revenue paid due
expected to grow to decrease in uninsured
- 67%: newly insured with • Pressure for M&A:
Medicaid
Hospitals - Diversify as ACA squeezes Medicare
- 33%: insured via state public reimbursements (outpatient services,
insurance exchanges etc.)
• Tax penalties for citizens without - Increase in scale lowers administrative
insurance & other costs (IT)
• Insurance companies must pay • Decreased profit margins from increased
rebates to consumers if non- number of enrollees
medical spending is above 15-
Insurance - New enrollees utilize higher levels of
20%
Companies care
• Exchanges and Medicaid
- New industry taxes to pay for ACA
expansion take effect starting
2014 - Rebates
• Life of Medicare trust fund • Increased demand for prescription drugs
Pharmas
expanded from 2024 to 2026 for newly insured
General • Innovate to economize on costs
1 Healthcare
Government Policies
Government Spending Implications
• Lower federal deficits
5.7% expected overall increase • Increased hospitalization
from 2013 to 2023 • Reductions and delays in drug
- Retirement of baby boomers approvals
7% increase in Medicaid enrollment
to 6.1B people