The Best Stocks for Obamacare's Medicaid Surge

These stocks have the most to gain from Obamacare's 4.4 million new Medicaid members.

Mar 16, 2014 at 11:00AM

The Affordable Care Act, better known as Obamacare, is perhaps best known for the individual mandate, which requires American adults to purchase health insurance in public exchanges or face a tax penalty. The law also required all states to expand Medicaid, a program for low-income individuals and families, to all citizens making up to 138% of the federal poverty level (FPL). While the Supreme Court invalidated Obamacare's mandate that all states expand Medicaid, many (26 and the District of Columbia) chose to expand Medicaid up to 138% FPL in exchange for federal money that currently covers 100% of the cost.

Governors in many of the remaining 24 states face mounting pressure to take the additional federal money and expand Medicaid, which would potentially benefit a variety of stocks. Hospitals like HCA, Community Health Systems (NYSE:CYH) and Tenet Healthcare (NYSE:THC) would reduce their bad debt expense because more previously uninsured low-income customers would have insurance helping them pay. Tenet Healthcare wrote off almost $1 billion to bad debt expense last year, while HCA wrote off a whopping $3.9 billion. Medicaid-focused insurers like Molina (NYSE:MOH) and Wellcare Group (NYSE:WCG) could also see further membership (and thereby premium) growth if more states choose to accept the federal money to expand Medicaid.

On Friday's Obamacare-focused episode of Market Checkup, Motley Fool health care analysts David Williamson and Michael Douglass consider the current state of play in the Medicaid expansion and identify which stocks are most poised to benefit if more states continue the expansion.

Invest In The Next Wave of Health Care Innovation
The Economist compares this disruptive invention to the steam engine and the printing press. Business Insider says it's "the next trillion dollar industry." And the technology  behind is poised to set off one of the most remarkable healthcare revolutions in decades. The Motley Fool's exclusive research presentation dives into this technology’s true potential, and it's ability to make life-changing medical solutions never thought possible.  To learn how you can invest in this unbelievable new technology, click here now to see our free report.

David Williamson has no position in any stocks mentioned. Michael Douglass has no position in any stocks mentioned. The Motley Fool recommends WellPoint. The Motley Fool owns shares of WellPoint. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information