2017/03/24 Commentary: Healthcare Reform Rx
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Commentary: Friday, March 24, 2017
Healthcare Reform Rx
The question seems to be whether there is indeed any possible prescription for US healthcare reform after it was obvious the votes for passage of the Trump-Ryan legislation lacked the necessary votes in the House of Representatives on Thursday. After many assertions by all of the Trump loyalists that there would be a successful passage of the House bill, the cancellation of that vote Thursday afternoon was a really shocking affair… or was it? There was good reason to believe the current House healthcare reform bill was in serious trouble, as we noted in our Thursday morning emailed note. Most important at present is to revisit the reasons the healthcare reform bill experienced de facto defeat yesterday, and why the equity markets and other asset classes are behaving so well is the rightful more immediate focus.
Dealing with the straightforward answer to the latter first, there is another vote on the exact same partial compromise scheduled for today. While in the same final form from yesterday there is no reason to believe its chances are any better, the markets have to allow that that there may be a constructive surprise. And regarding the market responses, here’s the ultimate cautionary word that is much the same as prior to the UK Brexit vote and November US election: this is an imponderable ‘binary’ decision.
That is because the House Republicans who control the agenda have indicated that next vote will be between 14:00 and 17:00 US Eastern Daylight Time. Yet a realistic view under the contentious situation (more below) on this particular iteration of healthcare reform means that the final negotiations are likely to be drawn out beyond that. And in any event, any vote taken after 15:00 EDT will be after the last of the markets (US equities) are Closed for the weekend. So it is an imponderable how the markets will react to either the initial success of the Trump reform program, or failure which casts a pall over all of it.
As it was apparent to us that the political dynamics within the Republican Party created a very fraught path for the House healthcare reform effort, we will first revisit and expand just a bit on that view from yesterday’s emailed note. The expansion will delve into the Republican Party split along moderate-conservative lines that explains quite a bit.
Authorized Subscribers click ‘Read more…’ (below) to access the balance of the discussion. Non-subscribers click the top menu Subscription Echelons & Fees tab to review your options. As this is a concise follow on analysis of the US equities activity and relative performance of other equities and asset classes, there is no Extended Trend Assessment in this post. Please refer back to last weekend's post for that.