Whats the attraction to investing in health-care companies?
From an investor’s standpoint, home care had the extra gas of profitability that it had never had before. Home health care is growing 7% to 9% a year organically. That’s a pretty attractive market to just hang your shingle out and grow that much. Home health also has a stable reimbursement environment. We get paid for positive outcomes, not just for activity. There is an incentive to help people get better and do it less expensively. Investors also see a large, stable growing population of patients. What are the risks of health-care investments? Does Medicare funding pose a problem? The biggest risks are always regulatory reimbursement changes at the state and federal level. If Medicare reform becomes the hot topic in Washington and the prescription drug bill comes in more than Congress expected, they get their calculators out and find a way to pay for it by shifting money around within the Medicare program. They could reduce rates in home care. The other risk is finding an available s
