Health industry shows stock market muscle

Despite various concerns and challenges, health care stocks, including shares of for-profit hospitals, have fared well in the opening weeks of 2013.

The Associated Press: Health Care Among Early Leaders In The S&P 500
Health care stocks have started off the year on a tear. The industry group that includes health care providers, drugmakers and biotechnology companies has advanced 7.3 percent this year, making it the second-best in the Standard and Poor's 500 index, trailing only energy companies. Even drugmakers, traditionally considered a safe-haven play, are outperforming the market (Rothwell, 1/28).

Modern Healthcare: Reform Brightens For-Profit Outlook; Chains See Share Prices Surge
Despite worries about a storm of reimbursement cuts expected to rain on all sectors of the health care industry, shares of for-profit hospital operators remained buoyant in the early weeks of 2013. The acute-care chains continued what was already a strong run last year as investors calculated that the benefit of having more insured patients would ultimately outweigh any payment squeeze. As the closing bell sounded on Jan. 25, shares of hospital operators showed sizable gains over their performance four weeks earlier, during the last full week of 2012. HCA, Nashville, and Tenet Health Corp., Dallas, have gained about 25 percent over the period, while Community Health Systems, Franklin, Tenn., is up nearly 29 percent (Kutscher, 1/27).

In other health industry news --

The Associated Press/Washington Post: Analysis: Is It Fair To Penalize Smokers And Overeaters? Yes, Say Experts. Here's Why.
Faced with the high cost of caring for smokers and overeaters, experts say society must grapple with a blunt question: Instead of trying to penalize them and change their ways, why not just let these health sinners die prematurely from their unhealthy habits? Annual health care costs are roughly $96 billion for smokers and $147 billion for the obese, the government says. These costs accompany sometimes heroic attempts to prolong lives, including surgery, chemotherapy and other measures (1/26).