MarketSpeak

Humana’s stock got battered today, after President Obama’s statement on the news, last night, about reducing payments to health insurance companies, hospitals, etc.

For those who were eagerly anticipating a supportive gesture towards the ailing healthcare industry in the US, the President’s first statement leaves me perplexed. Perhaps it’s half a statement and the rest is yet to come.

It’s easy to understand that he sought to “stop the bleeding of cash” to providers and payers who were overcharging for many services. However, this also turns off the cash flow necessary for funding technology development projects. And, the President clearly put healthcare at the top of his priority list with “computerizing health records” as a key initiative.

So, if cash flow to providers and payers is decreasing, how will they fund new IT projects that are so badly needed?

The President has an interesting dilemma to manage. On the one hand, he tries to close out what seem to be egregious expenditures but, on the other hand, needs to ensure that required investments in business infrastructure continue to flow. Is he changing how this money will flow (by changing its source) or is he simply stopping the flow altogether?

A healthcare IT product and service provider needs to know. Where will the money come from to develop a badly needed healthcare information system upgrade?

Let’s see what the President’s next move will be and let’s hope that it’s very, very soon. More jobs are at stake.