Health insurers, hospitals and other providers may be affected if subsidies are ruled unconstitutional, yet healthcare investors predict the healthcare sector will remain strong regardless of the Supreme Court's decision.
Here are five concepts:
1. If subsidies are declared unconstitutional, many predict political pressure will motivate lawmakers to devise an alternative for people affected by the ruling.
2. Sven Borhd, founding general partner at OrbiMed Advisors in New York, stated although a ruling against subsidies would result in an immediate sell-off of healthcare stock, this would be short lived.
3. Healthcare stock HCA has increased more than 18 percent while Tenet has risen to 11.8 percent.
4. Open interests at Tenet Healthcare, the third largest United States for-profit hospital chain, presently are at 136,000 contracts, rising 85 percent from March.
5. The iShares US Healthcare Providers exchange-traded fund is up 8.9 percent since March 3 and has risen 16.8 percent this year-to-date.
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