The waiting game continues.
So far the anticipated “blue wave” in Congress hasn’t materialized, and what looks like a legislative gridlock is considered a good thing for healthcare. Regardless of your view on policy, taking out the risk of overwhelming changes means less uncertainty around extreme policies, perhaps ends ACA limbo, and ultimately, allows for better planning with respect to business models in healthcare, sources tell me.
Of course, all of this was reflected on Wednesday by soaring healthcare stocks, particularly across the managed care sector.
Here’s why, according to Dunston Almeida, a private healthcare and healthcare IT investor: “No Medicare public option will get passed, ACA is probably safe (if SCOTUS rules against it, maybe that’s an issue sometime in 2021?), MA rate increases may go down a bit but will still go up overall, data interoperability will be a priority and surprise billing legislation will have a harder time getting passed.”
In a Biden presidency, one industry banker added, there will be some Medicare expansion – and that’s a good thing for providers: “The question is how much can they do it and who will pay for it?”
Further, telehealth will remain a priority and any pharma legislation will still have a tough time getting passed, Almeida noted. That said, he cautioned that another stimulus bill to help providers will be unlikely if covid-19 worsens. In that case, “smaller physician organizations will likely be much more impacted.”
Overall, Almeida said, “seems like ‘Goldilocks’ for most of healthcare.”
Do you agree or disagree? Stay tuned for post-election insights on healthcare private equity and dealmaking in the coming weeks.
The week was not without major deal news. Advent International is partnering with Great Hill Partners as an investor in RxBenefits, which helps self-insured employers manage pharmacy benefits and costs, according to people familiar with the deal. Check out my full report for financial info and more.
CareCentrix, the Summit Partners-backed home- and post-acute care benefits manager, has scrapped potential sale plans after talks with Anthem fell apart, sources with knowledge of the situation said. Read more.
And in fund news… Amulet Capital Partners, founded by ex-JLL Partners principals, secured $300 million-plus for a sophomore mid-market healthcare fund, a person with knowledge of the matter told Buyouts. In fact, Fund II’s close may be helped along by Amulet’s recent agreement to sell Synteract to Syneos Health. Check out Kirk Falconer’s report for more info.
That’s it for me today. As always, write to me with any feedback, tips or just to say hello!