2019 business outlook: Health care industry
Medicaid expansion lifts health care in 2019
THE REAL ECONOMY |
Four states—Idaho, Nebraska, Utah and Montana— included Medicaid expansion on their ballots in 2018’s midterm elections. Montana’s ballot item was a renewal of expansion, which failed; the three other states saw Medicaid expansion initiatives pass, and we expect health care providers in those states to benefit in 2019.
In addition, a few states saw party changes in their gubernatorial elections. In Kansas and Wisconsin, for instance, newly elected Democratic governors now make expansion possible.
Data from the Centers for Disease Control and Prevention show that states with Medicaid expansion have about half the uninsured adults of states without it, a trend that positively affects health care providers in states with the expanded government benefit. In addition to a favorable impact on organizations such as hospitals and physicians’ practices, we would also expect to see an increase in private equity investments related to behavioral health companies such as those that address substance abuse for Medicaid enrollees.
See more of RSM's business outlooks for 2019
Economic narratives for 2019 include continued trade tensions, more interest rate hikes and declining unemployment and wage growth.