Because health care plays such a big role in the Philadelphia economy, any time change is in the air it gets a lot of attention here.
President Obama’s first budget proposal calls for spending $634 billion over the next 10 years to modernize health care.
Investors’ first instinct was to sell. Yesterday, most health-care stocks finished lower.
Locally, health insurer Cigna Corp. closed down 8.5 percent. Aetna Inc., which employs more than 3,500 in the region, declined 11.3 percent.
All of the drug companies in the area were down, too. Merck & Co. Inc. slumped 6.7 percent. Cephalon Inc. was down 3.7 percent, Johnson & Johnson 2.8 percent, and GlaxoSmithKline P.L.C. 2.7 percent.
For-profit hospital operator Universal Health Services Inc., of King of Prussia, fell 8.2 percent, while Community Health Systems Inc., which owns four hospitals locally, dropped 5.5 percent. Tenet Healthcare Corp. bucked the trend, closing up 10.7 percent after an analyst upgrade.
This region has benefited from the concentration of nonprofit health-care institutions and for-profit businesses here. Many have made a good living off a very dysfunctional, expensive system.
I don’t think health care is to Philadelphia as the auto industry is to Detroit. But if it is, let’s hope the employers here prove quicker to adapt.
How many bank presidents would like to have the ear of the Federal Reserve Board of Governors right now?
Well, Richard J. Green, CEO of Conshohocken-based Firstrust Bank, will. He and five other bankers have been named to two-year terms on the Fed’s Thrift Institutions Advisory Council.
That 12-member group meets with the board of governors three times a year to talk over developments relating to thrift institutions, the housing industry, mortgage finance, and regulatory issues. Expect a long agenda for the next meeting in June.
Green, 56, has run Conshohocken-based Firstrust since 1995. The bank has assets of $2.5 billion and 25 branches, mostly in the Philadelphia area.