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Healthcare webinar slides-10-28-2015

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healthcare update

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Healthcare webinar slides-10-28-2015

  1. 1. Healthcare Hijinks 28 October 2015 War Room
  2. 2. HiddenLevers War Room Open Q + A Macro Coaching Archived webinars CE Credit Idea Generation Presentation deck Product UpdatesScenario Updates
  3. 3. Market Update ObamACAre in Review US Healthcare Sector Scenario: US Healthcare Costs Healthcare Hijinks
  4. 4. HiddenLevers MARKET UPDATE
  5. 5. IPO Market Dangerous Waters Market Update sources: HiddenLevers 1 Oil Rally Head Fake China Rate Cut + ECB QE Best Oktoberfest Ever 2 3
  6. 6. Budget Deal – Debt Ceiling tabled until 2017 4 sources: HiddenLevers, NY Times Cuts for Medicare providers Cuts for SS Disability Medicare premiums NOT rising debt ceiling won’t impact election total spending up 1%
  7. 7. 2011 US Debt Downgrade: First HL Success Research + Model Accuracy + Functionality
  8. 8. HiddenLevers OBAMACARE IN REVIEW
  9. 9. TREND: Healthcare Inflation vs CPI sources: HiddenLevers CPI > Healthcare Inflation -4 times in the last decade -4 times in the 5 decades prior -Overall, gap is narrowing CPI above Healthcare Inflation 1957-’05 CPI above Healthcare Inflation 2005-’15
  10. 10. TREND: Insurance Premiums sources: Kaiser Family Foundation, Academy Health -Premium growth unchanged by Obamacare -Third Party Payers are the real culprit -Costs passed to individual as higher deductibles Worker Contributions for Employer- Sponsored Family Health Plans, 1999-2015
  11. 11. OBAMACARE: Report Card SUCCESS FAIL 35% drop in US uninsured rate Medicare cuts sticking Supreme Court upholds ACA key tenets sources: Fox News, The Hill, Health Affairs, Gallup, Families USA, CBO.gov, RAND 2015: 16.9M enrolled, below 20M estimate Canceled policies + premium shocks Incomplete Medicaid rollout–20 states left
  12. 12. OBAMACARE: Candidate Platforms sources: HiddenLevers, Time, NY Times, Politico, NPR Hillary Clinton REPEAL OBAMACARE RETURN TO PRE-ACA LESSEZ FAIRE HEALTHCARE Bernie Sanders Ben Carson Marco Rubio Jeb Bush REPEAL OBAMACARE HEALTH INSURANCE TAX CREDITS ATTACK BIG PHARMA TO LOWER DRUG COSTS FINISH WHERE OBAMA LEFT OFF CREATE BONAFIDE SINGLE PAYER SYSTEM LOOK TO CANADA FOR GUIDANCE REPEAL OBAMACARE CREATE PRIVATE HEALTHCARE ACCOUNTS
  13. 13. HiddenLevers US HEALTHCARE SECTOR
  14. 14. HEALTHCARE: Performance Comparison sources: HiddenLevers Biotech has outpaced Nasdaq + S&P Health Care Index by 3X Biotech: +450% Nasdaq: +130% S&P Health Care: +130%
  15. 15. HEALTHCARE: Biotech Fundamentals sources: HiddenLevers, Kaiser Family Foundation -New Drug Approval relatively flat since 1970. -Biotech Sector has surged anyway in last 6 years. -Reasons: Pharma pricing power, QE fuel
  16. 16. HEALTHCARE: Biotech Crash source: HiddenLevers, Investment News
  17. 17. HEALTHCARE: Opportunities source: HiddenLevers healthcare REITS wearable tech preventive care healthcare IT drugstores MACRO SCREENER
  18. 18. HiddenLevers SCENARIO: US HEALTHCARE COSTS
  19. 19. 2014 – ACA new + Obama v GOP Scenario Update costs contained via ACA costs contained despite ACA Runaway costs 2015 – New Voices + Biotech Bearishness Obamacare US Healthcare Costs
  20. 20. GOOD: Employers Drop Coverage source: HiddenLevers corporations, large + small, done as providers ACA penalties cheaper than plans Business can drop plans and hike pay to attract workers “Cadillac” tax removes tax deductibility No healthcare costs = higher margins
  21. 21. BAD: Price Controls Hurt Sector Let Medicare negotiate = drug price crash new regime puts the squeeze on healthcare sector source: HiddenLevers Clinton mention tanked biotech New specialty drugs priced in six figures Biotech (eg Valeant) biz model IS price hikes
  22. 22. UGLY: Runaway Costs Hurt GDP Healthcare sector outperforms source: HiddenLevers, EIA, DOT, Business Insider All other sectors negatively impacted prices spiral despite government efforts Healthcare spend crowds out consumer spending Healthcare inflation doubles to 4.5% Medicare solvency again in doubt
  23. 23. SCENARIO: US Healthcare Costs healthcare inflation 4.5 S&P -12% healthcare inflation 2.0 S&P 0% healthcare inflation 1.2 S&P 10% US employers could become more competitive globally if they drop health care coverage or increase deductibles significantly. Healthcare sector has enjoyed price increases above inflation for decades – price controls or bulk government discounts could challenge this trend High healthcare inflation might act as a “tax” on GDP, lowering consumer and business spending and driving markets lower. Good employers drop coverage Bad price controls hurt sector Ugly runaway costs hurt GDP
  24. 24. Healthcare Hijinks – Take Aways Healthcare cost deflation pre-dates Obamacare Biotech + big pharma face headwinds previously avoided Link between employer + healthcare is ending Healthcare inflation outpacing CPI is due to third party payers

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