Let’s get the obvious out of the way: the launch of the Affordable Care Act on Oct. 1 was perceived by many to be, shall we say, less than ideal.
What was supposed to deliver an easy-to-use gateway for millions of Americans to buy health insurance for the first time was in fact, in the words of President Obama, “botched.”
A mandated fix on December 1, brought about a welcome, if imperfect, change. About 80% of users were able to complete their application online after the fix, compared with just 30% at the healthcare.gov “Obamacare” site’s original launch.1
However, the damage, both to the welfare of US citizens seeking health insurance and to President Obama’s standing among Americans, was done. As the Washington Post noted on Tuesday, Obama is ending his fifth year in office with the lowest approval ratings at this point in the presidency.2
While President Obama’s recent fiscal battle with Congress also likely contributed the plummeting of his approval, only 34% of respondents in a national poll approve how Obama is handling the implementation of his own Obamacare.
For an investor, however, it may be worth wondering: Is this one of those Warren Buffett moments, where it’s time to buy when everyone is selling?
In other words, have we reached the point where the public’s opinion about Obamacare is so low, it can only go up from here?
Ironically, many of the stocks that could be expected to perform well under the Obamacare regime have charged ahead with nary a pause. The Obamacare motif is up 3.9% in the past month and has gained 45.5% in 2013 alone.
The S&P 500 is up 1.4% in the past month and has risen 24.9% this year.
And now comes evidence that if you give people a working website, their embrace of Obamacare manifests itself much differently.
Take California, for example. As the San Jose Mercury News reported, in the first week of December, Californians signed up for private health insurance on the state online exchange at nearly three times the rate as a month earlier.3
Almost 50,000 people had signed up through December 7, at a rate of 7,100 per day.
Since the launch of the marketplace on October 1, more than 156,000 people have signed up. That means one out of every three people signed up throughout the US has done so in California.
In addition, 179,000 Californians will probably be eligible for the expanded version of Medi-Cal, the state’s health program for the poor, the Mercury News reported.
Alan Weil, executive director of the National Academy for State Health Policy in Washington, DC, said the growth in month-by-month enrollments proves uninsured people are interested in obtaining healthcare.
In that sense, the wishes of state health exchange officials and investors aren’t that different – increase the rolls of people with access to healthcare. Needless to say, investors harbor the additional wish that more people could mean more opportunity for revenue by healthcare providers – and quite possibly, the continued rally in their stocks.
1Gina Chon, “Reboot fails to remove all glitches on Obamacare site,” FT.com, Dec. 1, 2013.
2Brett Logiurato, “Obama’s Current Approval Rating Is the Ugliest Since Nixon,” businessinsider.com, Dec. 17, 2013, http://www.businessinsider.com/obama-approval-rating-polls-nixon-2013-12.
3Tracy Seipel, “Obamacare: Californians Signing Up At a Stunning Rate,” San Jose Mercury News, Dec. 12, 2013, http://www.mercurynews.com/health/ci_24711755/obamacare-california-enrollees-make-up-nearly-third-nations, (accessed Dec. 18, 2013).