Travis Mullen Professor Cowan Faculty/Student Research

The Winners and Losers: Obamacare

The objective of the research being conducted and summarized is to analyze the impacts of the Affordable Care Act of 2008 (aka Obamacare). I will be focusing on the healthcare industry and firms associated with facilitating the well-being of Americans, with respect to profits and stock market prices. The goal of the Affordable Care Act (ACA) is to reform the American health care system and to provide access and quality healthcare to all Americans. The ACA contains multiple components with one reform being the way Americans buy health insurance. It requires that all Americans purchase a private health care plan or pay an additional tax. The bill focuses on preventive care services, protection from insurance companies denying coverage for pre-existing conditions, eliminates lifetime limits on benefits, and many other unprecedented reforms. The market segments I will be focusing on include insurance companies, drug distributors, hospitals, pharmaceutical companies, medical device companies, biotechnology companies and a few high risk investments that are loosely related to Obamacare.

I dont think any of the companies I am focusing on will be "losers" when it comes to Obamacare; the only major losers seem to be the patients. There are countless reasons why I think Obamacare will be worse for patients but that is not the objective of this report. When analyzing the companies at current market value they all seem to show potential for growth. Most of them looked poised for growth in the future and many have healthy dividends to add value. This is only true if the management of the companies I have highlighted are able to stay competitive and properly financed. I predict there will be no "losers", because by implementing Obamacare they are establishing and cementing themselves into the new system. With that being said though, I still believe there are may be multiple issues that could impact the companies in an adverse fashion, but the benefits should certainly outweigh the negatives. The reason I am so bullish on these stocks is largely focused on the fact healthcare is showing strong growth and the future of Obamacare will push to increase healthcare delivery across many industries and insure all Americans will be able to receive proper healthcare. These companies are what you could say are the best of breed as they have a strong hold on the current market with deep pipelines and strategic locations that will only add value in the future. The companys revenues and net income may show a temporary decline initially when Obamacare is first implemented but these negative impacts to me are potential buying opportunities. We must remember that we are talking about the United States of America; in my eyes the best country in the world. Unless the country goes bankrupt, the healthcare business and the companies that are highlighted, if related to the health and well-being of its citizens, should remain as an important industry to our citizens. Many Americans have had ability to access and benefit from good medical care and will not want to cut back on their healthcare needs. The hope is that with Obamacare, every American will be able to receive proper medical attention.

There are currently 30 million Americans who do not have health insurance, which under Obamacare will be required to purchase insurance or be penalized. I started with the concept of being cemented or anchored into the system because currently and in the new Obamacare concept, the health care system revolves around the insurance companies and their control over the payment process. Health insurance should revolve around the relationship between the insurer and the insured. This is often not the case due to rules and regulations that benefit employers who end up buying the majority of patient health insurance. The relationship lies between the insurer and the health care provider because the insurer dictates how much money will be paid to the provider and for what services. Under the Affordable Care Act up to 30 million additional people who were previously uninsured will face penalties if they do not acquire health insurance. This in turn gives more power to the insurance companies. With all of these people needing to be insured, the largest insurance firms will consistently beat out the smaller insurance firms through economies of scale. The largest insurance companies will be able to offer the most valuable insurance with the lowest premiums. This will give them even more control over the market. What about entrepreneurs finding innovative ways to compete with these large firms? Under the new health care act, many forces work against the smaller insurance companies and will prevent them from gaining any competitive advantage through innovation. In the required and newly created Health Insurance Exchanges, the benefit plans the insurance companies offer are forced to charge the same premiums to all patients regardless of health status. The larger firms gain the advantage through economy of scale. Since the smaller firms will be forced to offer the same premiums, the large firms will gain a competitive advantage through administration costs. The fixed costs and variable costs associated with each additional insurance plan allow the large insurance

companies to have a lower expense ratio per patient. The large firms will be able to have larger profit margins and will be able to lower the premiums of its insurance plans below that of the smaller insurance companies until profit margins are equal. If the large firms have identical premiums and coverage as the small firms they will enjoy the lower marginal costs. This is why currently the insurance companies around the United States are continuously buying up other insurance companies to compete on this basis. To make matters worse, the Obama administration announced a ruling that dictates how much money must be spent on insurers medical expenses. This is the minimum medical loss ratio or MLR. This requirement penalizes insurers who do not spend 80% (small insurance companies) and 85% (large insurance companies) of premium dollars on healthcare. If the insurer does not pay out that percentage they must give the policyholder a rebate for that amount. So automatically what policyholder would not want a guaranteed 5% more of their premium dollars spent on their health care or get a rebate back from the insurance company for that amount. In 2012, Medicare began paying fees to Accountable Care Organizations (ACOs). The goal of the Obama administration is to eventually see all health services in an ACO. Under Obamacare, these added fees will hurt the small insurance companies and again cut into profits at a larger percentage than the large insurance companies. There is also going to be a Blue Cross/ Blue Shield tax hike and an increased tax on health insurance providers who will most likely pass these added fees to the patient premium. Are these insurance companies required to pay fees to ACOs? Well technically, no. Realistically though, they will have to because if they do not adopt these ACO plans or provide insurance to hospitals and doctors who are not a part of these plans, they will not be able to increase premiums. Doctors and hospitals will be paid less if they

do not join these ACOs. This is one of the ways the Obama administration plans to gain more control over the medical industry. Doctors will slowly lose patients because over time they may not be paid by Medicare or other government programs if they are not practicing in ACOs. If the government can get doctors and hospitals to join these organizations, they will be able to control the behavior and techniques used by doctors. According to Scott Gottlieb, a former U.S. Food and Drug Administration deputy commissioner and writer on health policy, the ACA approach will stifle innovation and entrepreneurship and is already causing venture capital to leave the healthcare market.i If small insurers cant compete on price or innovation and venture capital disappears, we might as well just count them out completely. The only companies remaining under these assumptions will be the nationwide insurance companies. This is what I like to call cementing in the large insurance companies as the only real players in the future healthcare insurance industry. Since these nationwide insurance companies will have such a strong grasp on the market, they are not going to allow plans that keep them from being profitable. Any extra expenses or taxes will just be transferred to the policy holder. If insurers are going to be constrained in their ability to realize profits on their insurance business, we can look at the insurer in a similar way as we do to regulated utilities. They will be low growth and relatively low risk investments. Not to mention they are too big to fail. If we are going to compare the insurance industry to a utility we have to look at the growth rate of the countrys population since they are going to be the future of the insurance companies future medical costs which is growing at a staggering rate and also inflation; since costs will resemble inflation over time. U.S. medical spending has been growing way faster than other household costs. In the last decade medical spending almost doubled, it reached $2.6 trillion in 2010.

With medical spending growing and the amount of people who need to be insured growing, the insurance companies look strong. These market dominating insurance companies look like great long-term buys. The Insurance companies in my Obamacare Portfolio are WellPoint (WLP), UnitedHealth (UNH) and Cigna (CI). They currently are presenting a very interesting investment opportunity. UNH and CI are currently trading below their enterprise value. Also their P/E ratios are below 12, with WLP having a P/E of 8.5. Although people often think Medicare is a public insurance it is not actually managed by the Federal government. In most places, Medicare is managed by private contractors such as Cigna and BlueCross. In the 1950s, BlueCross was the dominant insurer in almost every state. This was partially due to the fact that state legislation favored these entities over the competition. Does this sound a little similar to what is happening now? Once this bond was formed it was

nearly impossible to break. Since BlueCross was so large the hospitals would only accept payments in the same fashion as BlueCross. Some insurers refused to pay in the same way as BlueCross and the hospitals would just refuse to do business with them. This domination and control over the payment system has only become worse and has turned the insurers in to providers of care. This domination of health insurance in the 1950s resembles some of the similar circumstances insurance companies and hospitals are facing now with Obamacare and ACOs. The insurance companies dominate the entire payment system. They choose the amount paid to hospitals/doctors and for what services they will pay for. Medicare is setting about 6 billion prices across the United States and other countries at any one time. Medicare is regulating the entire transaction process between doctors and patients. There are roughly 50 million Medicare enrollees. If they have 1 procedure a year with all the different possible ways it can be correctly or incorrectly coded it would mean that Medicare is regulating 3 quadrillion (3,000,000,000,000,000) potential transactions.ii Now that we understand Medicare is managed by private contractors the government has little control over this transaction process. Even if the government wanted to control this transaction process, the private companies have been doing it for so long they would have a much more streamline and cost effective strategy. This gives the insurance companies an advantage when discussing the threat of new entries. These private companies are doing more than just setting prices; they are controlling the entire process. Not only is Medicare mostly managed by private insurers, but nearly 71.5% of Medicaid enrollees nationwide are in health plans managed by the private sector.iii These private insurers manage almost the entire insurance business across the country. This might be hard for some people to believe but U.S. insurance companies are so good at what they do, they are actually contracting

with other governments and exporting their business practices.iv The 32 million more Americans who are likely to get insurance are most likely going to end up on one of these private insurance plans. Revenues will definitely increase if more Americans purchase insurance (which is the whole goal of ObamaCare). With the new regulations, it is possible the profits realized by these firms may not increase as fast. We can get one thing straight though; these insurance companies want to remain profitable and will not participate in activities that allow them to lose money. Beginning in 2014, most people will be required by law to have proof of insurance attached to their tax return. If you are not covered by an employer plan you will have to buy insurance through the government regulated exchange. This is a great free marketing tool for insurance providers that will reduce expenses. This exchange could allow insurance providers to cut back on marketing tools and use those marketing dollars to reduce the cost of insurance; or stay in the insurers pocket for a rainy day. Since insurers will be constrained in their profitability of the insurance business, it leaves no incentives to try and reap rewards for developing new products. This means there will be less competition among companies. The ACA does not mention anything about returns made from invested reserves. I believe this is where the insurance companies are going to look to increase profits. Although it will most likely lead to riskier investments; if managed properly these gains could be huge. With the expected increase in revenues, the amount of money in these reserves will also grow much larger. So I started off by discussing why I believe the large insurance providers are cemented into the system and are here to stay. This is what makes a good investment; an investment in companies that have control over the industry. It has little competition and if competition were to evolve, it would take many years to do so. This would give you adequate time to adjust your investment strategy.

One more item worth mentioning is the new regulations and taxes that can affect the bottom line. One of the major issues surrounding ObamaCare and insurance companies are the unintended consequences of people being encouraged to remain uninsured while they are healthy and purchase insurance when they become sick. Under ObamaCare, insurers are required to insure all individuals regardless of previous health conditions. So people will be able to purchase insurance on the way to the hospital; if they broke their arm for example. This will cause healthy people to drop out of the market and only people with health issues will remain. This will in turn cause more healthy people to drop out of the market as the insurance premium continues to rise. The insurance company will always make sure it can cover costs; this potential scenario will only hurt the consumer because the added costs will just be transferred to them. Many other things are working against the insurance companies since they are required to charge the same premium to all enrollees regardless of health status. The premium attached to these high-risk individuals is too low to cover the costs of having them on the health plan. This is going to make it hard for these individuals to find health coverage because the insurers will actually compete on the basis of not insuring these high-risk individuals. This is especially true with the chronically ill because insurers are prohibited from imposing lifetime dollar limits on essential benefits. These are the patients insurers are worried about. In the health insurance pool, 5% of enrollees will spend 50% of the money, and the top 10% will spend nearly 66% of the money. If insurance providers do not follow government regulations put into place by the government they will not be able to justify premium increases over 10 %.v This is one of the plans of the Obama administration that they are not talking about very much. They are trying to make insurers, doctors and hospitals join ACOs or they will not be able to receive as much

money for their services. Once in these ACOs they are going to be able to control and regulate these industries to conform to their policies. Massachusetts is the precedent for ObamaCare. Many of the new rules and regulations being put into place under Obamacare are currently in place in Massachusetts. The industry is particularly worried about individuals they call jumpers and dumpers who receive the care they need and then drop coverage once their medical bills have been paid. This problem has been growing more popular.

Seeking Alpha called insurance companies dead men walking. This is because they believe people will buy insurance on the way to the hospital which will lead to decreased enrollment, increased premiums and falling profits.vi The new insurance plans are required to cover certain preventive services such as mammograms and colonoscopies with no co-payment. The list is very extensive, all of these added services will be provided without paying a co-payment. Even if insurance companies are required to cover all patients regardless of health status, are prohibited to apply lifetime dollar limits, and might only insure the sick. You can bet they will keep their bottom line profitable.

All these possible increases in cost and premiums will be transferred to other people. The insurance companies will charge patients more money for less care, or will pay the doctors and hospitals less for their services. In the end insurance companies control the payment process and will find a way to remain profitable. ObamaCares overall goal is to provide affordable health insurance for all U.S. citizens. Currently the U.S. healthcare system has a total bill of $2,800,000,000 that is roughly $9,000 a year for every man, women and child.vii In 2011, 48.6 million Americans went without insurance. These citizens are now going to receive an additional tax, if they do not obtain health insurance. These individuals will most likely comply and purchase an insurance policy; because they are still going to receive healthcare. This tax will just add to the out of pocket health expenses individuals will have to pay to receive care. Health insurance costs per capita have been rising at twice the rate of per capita income for the past 40 years.viii With a track record like that, it is going to be hard to slow down the cost of Medicare. Obamacare is attempting to stop the rising costs. Since insurance companies are expecting to insure millions of more Americans we have to discuss how this cements in the remaining industries involved in healthcare. The industries we are focusing on in this report are Hospitals, Drug Distributors, Pharmaceuticals/Preventive Care, and Medical Device companies. We described earlier how the largest insurance companies control the entire transaction process, while many Americans pay a minimal co-payment or only a minute portion of their medical bill. What I am going to argue is that since individuals are only paying for a portion of their medical bills, they will consume until out of pocket costs, equal medical care. The whole principle is people will behave differently when they are spending other peoples money. Good

health is a priceless asset in most peoples eyes. On average, only 10 cents out of every dollar you spend at a physicians office is coming out of the patients pocket.ix The remainder is paid by a third party; an employer, insurer or the government. Under Obamacare these incentives will become even worse per individual; plus the millions of currently uninsured individuals who will be guaranteed the long list of preventive services available to them at no cost. The only cost will be your valuable time due to the large increases in waiting lists and lines to see your medical provider. Once an individual pays their insurance premium, that money is combined with every other individuals premium in a pool. Once people hit this pool of money which is no longer their money, they will consume an even larger amount of care to benefit from the free medical care.x When something is free, the temptation is to take everything that is offered. This is only going to continue because individuals are not willing to manage their own health policies. It is also in their best interest to continue to have their employer pay for insurance. Employer-paid premiums avoid federal income tax, and also state and local tax. Individuals are not able to purchase their insurance with pretax dollars like employers can. Also, insurance companies do not want to deal with individuals because it leads to larger administration costs. So individuals are going to continue to have insurance paid for by their employee due to the money incentive they gain.

This is the same for most of the uninsured people as well because most of them do not have access to employer-provided health insurance. So all the incentives to continue to spend more on healthcare only worsens. These people will continue to consume until its value at margin approaches zero. Since the cost of care is well above zero, unconstrained patients will consume healthcare resources very wastefully. This over consumption of individuals is going to lead to large profits for Drug Distributors, Biotech companies, Pharmaceuticals/Preventive care and hospitals. The next industry in line after the insurance companies is the Hospitals that facilitate the health care to the patients. Since the hospitals are the actual provider of health care they do hold some bargaining power when it comes to pricing. Even though they hold some bargaining power, there are subsidies in place that allow the hospitals to continue operations. These subsidies help

accommodate the hospitals needs. These subsidies usually lead to the hospitals to bargain with the government over subsidies more than bargaining with the insurance companies over pricing. With this current system it allows for the insurance companies to continue to run the system while the government picks up the additional charges. The first reason why I believe the hospitals are cemented into the program is because under ACA, up to 30 million additional people will be insured. ACA will also lead to the rest of the population to have more generous coverage. The result of this will most likely lead to demand for medical care to exceed the supply. This will lead to longer waiting times and shorter doctor visits. What this will also mean is the hospitals will have more demand for their services than supply. In basic economics you learn when demand rises and supply does not this will lead to price increases that will benefit the hospitals. These price increases won't affect the non-profit hospitals or the government owned hospitals, it will directly impact the for-profit hospitals. For-profit hospitals usually provide highly profitable services and do not offer the services that are unprofitable. They specialize in these high profit medical services and leave the other services for the non-profits and government hospitals. Is this right or wrong? Well, I don't think that is a question of morals. I think it is good business practice that the for-profit companies realize the government must provide these services regardless of profitability. This hole in the system leads to for-profit hospitals to not provide certain services due to low profitability. This may lead to a tax in the future; which I am not against. That is the future though and right now this way of operations leads to higher profit margins by specializing its services. For-profit hospitals often times are located in strategic locations. They locate themselves in high income areas where most patients are privately insured or have more disposable income.

By being located in areas of high income patients it also increases the chance these patients will take part in surgeries that are more expensive and often times more profitable.

The locations of hospitals already operating literally "cements" them into the current system. People are always going to receive medical care from places located closer to their home if all other things are equal. With the increase in insured individuals the amount of people looking to receive medical care will only grow larger. This means the hospitals will constantly

have a supply of customers. A supply that will only get larger over time. Since good health is a priceless asset, these for-profit hospitals are poised to grow revenues and profits. The most important thing to take out of the hospital industry is that for-profit hospitals prioritize their goals differently than non-profits and government hospitals. They are able to benefit by not offering low profit services because other hospitals (who do not care if they make a profit) will provide the necessary services to the patients. When hospitals do provide services to indigent and uninsured patients they receive payments from the government to offset these costs. These payments are categorized as Disproportionate Share Hospitals or (DSH). They also provide 340B Price Controls which forces the drug manufacturers to give discounts to outpatient clinics and hospitals that treat a high number of lower profit patients. It is estimated this will be around 20,000 facilities under ACA.xi With higher reimbursement rates the hospitals will be huge winners that directly affect the bottom line. They will have higher reimbursement rates because more patients will be insured, this means there will be fewer indigent and Medicaid patients. These patients acquire high medical bills and don't pay any money. They are one of the biggest reasons hospitals have lower profits. The hospital industry has about $40 billion in unpaid medical bills every yearxii. Under Obamacare this amount of unpaid medical bills should decrease dramatically. Over the years hospitals have been quietly consolidating, this has allowed them to have hospital systems that "dominate" regional markets. This allows them to gain more bargaining power to dictate higher prices from insurers. The median operating margin for 200-bed hospitals and above in 2011 was slightly negative at (-0.7%)xiii.

Another way hospitals are becoming highly profitable is often not observed by most people. They are becoming more profitable through amenities provided to the rich. A writing in the New York Times, Nina Bernstein observed the rooms and compared them to a Four Seasons.xiv The bed linens were by Frette, Italian purveyors of high-thread-count sheets to popes and princes. The bathroom gleamed with polished marble. Huge windows displayed panoramic East River views. And in the hush of her $2,400 suite, a man in a black vest and tie proffered an elaborate menu and told her, "I'll be your butler." It was Greenberg 14 south, the elite wing on the new penthouse floor of New-YorkPresbyterian/Weill Cornell Hospital. Pampering and decor to rival a grand hotel, if not a Downtown Abbey, have long been the hallmark of such "amenities unites", often hidden behind closed doors at New York's premier hospitals. But the phenomenon is escalating here and around the country, healthcare design specialists say, part of an international competition for wealthy patients willing to pay extra, even as the federal government cuts back. These healthy patients are highly profitable to the hospitals and since they have so much money, the rising cost of health care does not affect them. They want to receive the best care, with the most amenities regardless of price. These patients are also able to receive care with little to no waiting times because they are paying for it out of pocket and most people cannot afford these services. The other industries that will benefit from Obamacare are the Pharmaceutical and Biotechnology companies. This is pretty much a no brainer. Yes, there will be added taxes on branded drugs and drug makers must provide higher rebates to Medicaid for prescription drugs. This will amount to millions of dollars in lost profit, but let's be honest; these costs are a drop in

the bucket to the large corporations. The worst part about this is it might lead to less innovation because the drugs will not be as profitable. Or even worse the pharmaceutical companies will just raise the price to cover this new tax (which is already happening). But the drugs already on the market are still going to be purchased by people around the world. Like I said before, people's attitude toward their health is that it is priceless. People are not going to decide not to buy Advil because it costs 50 cents more than a year ago. The preventive care industry will see an increase in business under Obamacare, due to the belief that preventive care is the answer to lowering medical costs. Many of these preventive care solutions include screenings, vaccines and biotechnology processes. Also with insurance companies required to bring in 80-85% of revenue from medical procedures, the insurance companies will be pushing preventive care and medication drugs on its patients. Johnson and Johnson (JNJ), one of the companies in my Obamacare portfolio will benefit under Obamacare because it has products in virtually every portion of healthcare. Its pharmaceuticals include anti-infective, dermatology, contraceptive, antipsychotic, hematology, oncology, immunology, neurology, pain management, infectious diseases and vaccines. The expanded coverage means greater utilization of health care. Big pharmaceutical companies have been spending millions of dollars on lobbying efforts to pass the health care bill. They would not be doing this if they did not believe that the reform would hold certain benefits for them. They actually agreed to save the Medicare system billions of dollars a year on prescription drugs. What was their motive? I believe they were motivated by insuring that certain proposals in the bill were not put through. One most importantly is the importing of cheaper drugs from Canada. Also they have longer patents on generic versions of

biotech drugs. They wanted to make sure they had a strong grasp on the American market since it was expecting to have millions of more Americans in insurance plans under Obamacare. Now comes the companies that are flying under the radar in my eyes. The drug distributors, the ones we are focusing on are CVS, WAG, ABC, MCK and CAH. These companies face no added taxes and no new regulations. All they will see is a pure volume increase in drug distribution. The market for distributing pharmaceutical drugs is a $300-billion market.xv AmerisourceBergen, Cardinal Health and McKesson are three companies in my Obamacare portfolio; their combined market share exceeds 90%. Generic drugs account for about 9% of revenue for the Big 3 but account for 56% of profits.xvi As Obamacare slowly pushes towards more cost effective generics this will only increase profits. These distributors serve pharmacies, hospitals, physician offices and the drug manufacturers (who they buy the drugs from). As we know under Obamacare these pharmaceutical companies should see an increase in sales due to the amount of people becoming insured under Obamacare. Not to mention if people do choose not to become insured under Obamacare they will still require these drugs to stay healthy. So regardless of what happens these companies will see a gradual increase in sales. CVS Caremark estimates the newly insured may rise to more than 200 million additional prescriptions annually, an increase of more than 4%.xvii All these increases come with no additional taxes or regulations. So there is a threat to these companies, and that is if the national retail chains decide to eliminate the middle man (the drug distributors) and buy them directly from the manufactures. That leaves us with CVS and WAG. CVS and WAG supply drugs to the end users, the patients who pick up their new prescription. Under Obamacare the number of people visiting the doctor is

expected to increase which means the number of prescriptions should also increase. Leading to more sales and more profits for these retail chains. But wait, there is more; as the hospitals become overly crowded people will be more willing to pay for MinuteClinics which are located at CVS stores. These MinuteClinics cover the basic medical attention needs like vaccinations. Under Obamacare professionals are expecting a huge rise in the number of people trying to receive care from hospitals and medical offices. When people get sick of waiting 30 minutes(or more) for a 5 minute vaccination they will be more willing to pay out of pocket (at these MinuteClinics) for small medical needs that do not require a doctor, but rather can employ a nurse practioner who makes much less money. I have personally used these MinuteClinics to get my yearly influenza vaccination. They are quick and easy (and do not cost very much money, especially if you put a high value on your time). Overall, I feel like the healthcare industry in general will profit from Obamacare if they can enlarge their market share, keep administrative costs under control, manage the regulation appropriately, and find ways to overcome and circumvent the shortage of doctors, nurses, and other healthcare workers who will be needed to move all these potential patients into their service and profit areas. The companies I have chosen to put in my Obamacare portfolio have good management and established themselves in the industry. These large market cap companies that revolve around the medical care industry are exactly the companies I think investors should focus on. This report is used as a guideline to explain why I believe the medical care industry is going to show strong growth in the future. The companies you decide to invest in may be different than the ones I have chosen. I think overall if you invest in established, well managed companies you will do great.

My investing strategy is a dollar-cost averaging strategy where you make an initial investment. After that initial investment you must follow the stock price from its most recent high, where you will continually invest more money if it rises or falls. More shares are purchased when prices fall and less shares are purchased when prices rise. Conventional Dollar-Cost Averaging you buy more shares regardless if the stock price rises or falls. My personal strategy is to buy 20% more if the stock falls 8% from its most recent high. If it falls another 8% from that level I will purchase 25% of the initial investment. If it continues to fall from that level another 10%, I will purchase 35% of the initial investment.xviii I will be selling shares as stock prices rise depending on how the stocks expected return matches my required return. Some personal investment insight must be used during this strategy, especially if you see strong fundamental changes revolving around the company.

Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 263. Print. ii Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 236. Print iii ("Medicaid Managed Care Enrollment Report" Centers for Medicare and Medicaid Services, https://www.cms.gov/MediciadDataSourceGenInfo/downloads/2010trends.pdf iv Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 92. Print v Mark W Stanton "The High Concentration of US Healthcare Expenditures" http://www.ahrq.gov/research/rlqlq/expendria.pdf vi Obamacare Part 1 - Will Insurance Companies Survive? , http://seekingalpha.com/article/696821-obamacare-parti-will-insurance-companies-survive vii (obamacarefacts.com) viii Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 287. Print.
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Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 269. Print.
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Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 118. Print.

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Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 80. Print. xii Five Obamacare Winner In Second Presidential Term, Bruce Japsen,http://www.forbes.com/sites/brucejapsen/2012/11/07/five-obamacare-winners-in-second-presidential-term/ xiiixiii Forbes Article, America's Most Profitable Hospitals, by David Whelan, page 2,http://www.forbes.com/2010/08/30/profitable-hospitals-hca-healthcare-business-mayo-clinic_2.html xiv New York Times, Nina Bernstein. From Priceless, Curing the Healthcare Crisis. Written by John C. Goodman. page 101. xv Turner Investments, Why the Big Three drug distributors could get bigger, http://www.turnerinvestments.com/why-the-big-three-drug-distributors-could-get-bigger/ xvi Turner Investments, Why the Big Three drug distributors could get bigger, http://www.turnerinvestments.com/why-the-big-three-drug-distributors-could-get-bigger/
xvii

Turner Investments, Why the Big Three drug distributors could get bigger, http://www.turnerinvestments.com/why-the-big-three-drug-distributors-could-get-bigger/ Goodman, John. Priceless: Curing The HealthCare Crisis. Oakland, CA: The Independent Institute, 2012. 1. Print.
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This investment strategy is based off of a strategy I was shown by my old co-worker William Cerone at Merrill Lynch.