Hi DTB!

That Kingswell article was written in 2023, and they claim that: "In the nine years since Weschler’s comments, DVA has earned just 2.1% compounded annual returns

Hmmm...I quickly read DVA's most recent 10-Q and it appears they are forecasting a 2.1% revenue growth for 2025. You're correct that Medicare does not reimburse for services very well. When I was in the healthcare business, Medicare reimbursement (including copays) at the time was approximately 60% of my costs. Medicaid was even worse at 20% of my costs! The two programs combined were about 1/3 of my business. Another 1/3 was from private pays (insurance, cash, and contracts) which paid close to 100%. The last 1/3 were indigents that paid 0%! These consisted mostly of emergency patients, which we could not either legally or morally refuse to treat. Many hospitals had a similar patient-pay mix at the time. Government program reimbursements, in my experience, do not begin to keep up with inflation and it generally gets worse with time. I would guess that DVA has a very high percentage of Medicare and Medicaid patients. And to a lesser extent, a few private pay patients. Growth does help, to some extent...for a while. But basic economics will always rule. I sold most of my businesses almost 20 years ago. My last two personal physicians recently folded their private practices and went to work for large corporate practices. I wouldn't buy DVA but others will disagree. As Professor Mark Herschey used to say: "YMMV"*

*Your Milage May Vary