January’s Healthcare Index

Inspired by the monthly Harper's Index, this is 2019's first index on healthcare and finance. The average ratio of Medicaid-to-Medicare payments spending across the US across all services: .72; In CA: .52. The factor by which commercial insurance payments exceed the reimbursements from Medicare: 1.88x The net assets of HCA, the largest publicly-traded hospital in the … Continue reading January’s Healthcare Index

On Hidden Risks and Volatility

Volatility in investing can be a great thing. The attraction to Bernie Madoff's scam can be better understood by its lack of volatility. His funds showed annual returns of an eerily consistent 10-12% and at one point reported 72 consecutive months of positive returns. His strategy used a split-strike or collar options strategy (not related … Continue reading On Hidden Risks and Volatility

Passive vs. Active in Investing and in Health

It has taken over 40 years for index investing to reach 20% market share. That's longer and less heft than most people would guess. But it's also a reminder of how a good idea can take generations of incremental awareness and results to move beyond shallow roots. Index investing is a form of passive investing, … Continue reading Passive vs. Active in Investing and in Health

Part 2: Is The Cheesecake Factory in The Healthcare Business?

Now known in some circles for something beyond its array of cheesecakes, 2,000 calorie dishes, and cruise ship-meets-Las Vegas décor, The Cheesecake Factory (CAKE) added a second consecutive quarter of negative healthcare news, a cost that’s hidden in most companies' income statements. The impact of this quarter’s negative healthcare surprise was $4,600,000, or 44% of … Continue reading Part 2: Is The Cheesecake Factory in The Healthcare Business?

Corporate Capital Allocation and Healthcare Spending

I just re-read "The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success" by Willam Thorndike. It's an analysis of eight relatively unknown Jack Welch-record-beating CEOs and how they trounced the market and industry peers over 20+ years. Their primary source of value as CEOs was how they allocated capital, or how they invested … Continue reading Corporate Capital Allocation and Healthcare Spending

Is The Cheesecake Factory in the Healthcare Business?

People who work on the business side of healthcare often wish that companies would think about healthcare more often, or even concede that they are in "the healthcare business." I suppose part of this is the law of the instrument, which even if not said by Mark Twain, sounds like Mark Twain: "To a man … Continue reading Is The Cheesecake Factory in the Healthcare Business?