Credit default swaps at Nashville, Tenn.-based Hospital Corporation of America, Dallas-based Tenet Healthcare and Franklin, Tenn.-based Community Health Systems jumped an average of 88 basis points over the past month, indicating that investors are worried about the Supreme Court's decision on the Patient Protection and Affordable Care Act, according to a Bloomberg report.
Credit default swaps are financial agreements in which a seller of a credit default swap will compensate the buyer in the even the loan defaults or some other credit event occurs. As basis points on credit default swaps rise, investor confidence decreases. The rise in basis points could mean investors are hedging against potential patient volume declines if the PPACA is ruled unconstitutional, which would reduce the insured population, according to the report.
Swaps on CHS, the second-largest for-profit hospital operator in the United States, climbed 112 basis points in March to a total of 664. Swaps tied to Tenet, the third-largest hospital operator, jumped 97 basis points last month to 637. HCA, the largest of the hospital operators, had its swaps leap 55 basis points to 511.
Credit default swaps are financial agreements in which a seller of a credit default swap will compensate the buyer in the even the loan defaults or some other credit event occurs. As basis points on credit default swaps rise, investor confidence decreases. The rise in basis points could mean investors are hedging against potential patient volume declines if the PPACA is ruled unconstitutional, which would reduce the insured population, according to the report.
Swaps on CHS, the second-largest for-profit hospital operator in the United States, climbed 112 basis points in March to a total of 664. Swaps tied to Tenet, the third-largest hospital operator, jumped 97 basis points last month to 637. HCA, the largest of the hospital operators, had its swaps leap 55 basis points to 511.
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