Just Because Healthcare Stocks Are Soaring, It Doesn't Mean The Reform Bill Is A Massive Sellout

gsachs healthcare graph

As has become all too characteristic of arguments from liberal sceptics of the Democrats’ health care plan, analyses of the recent increase in share prices of major publicly-traded health care stocks have been misleading.

As we and other analysts have documented, share prices have reacted strongly and unambiguously to news that a public option might or might not be part of the Democrats’ health care reform plans. This is in line with a report issued in November from Goldman Sachs, which estimated that a health care plan passed with a robust public option — their so called “bear” case — should result in a 36 per cent drop in the prices of publicly-traded health insurance stocks:

Read complete analysis at FiveThirtyEight –>

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.