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Quarter-End Insights

Our Outlook for Health-Care Stocks

Reform and M&A activity are key themes in health care.

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The key development on the health-care reform front occurred just before the end of the third quarter. The long-anticipated proposal from the Senate Finance Committee finally materialized and, as is typical of any proposal that attempts to take a centrist approach, was greeted with a barrage of criticism from both ends of the political spectrum. We're planning to give an overview of Sen. Baucus' bill in a separate article at a later time (especially as we anticipate a number of modifications to the original bill will emerge in the near future), but we've already discussed the core components of the plan--guaranteed issue, individual mandate, excise taxes on lucrative plans, and creation of nonprofit co-ops--in our May issue of Morningstar Healthcare Observer.

Alex Morozov does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.