Good for What Ails You: Muni Bonds & American Healthcare

Good for What Ails You:  Muni Bonds & American Healthcare
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Eat fruits and vegetables. Exercise daily. Sleep eight hours a night.

We all know the basics of maintaining our personal health. But how can we help protect our community’s health? That’s where municipal bonds come in.

Muni bonds are a great way to help your favorite community’s roads, schools, and even parks. But the ever-dynamic muni bonds are also a solid way to fund healthcare facilities, from hospitals to life care organizations. Yes, muni bonds may contribute to your neighborhood’s health!

Hospitals

Good hospitals are often a cornerstone of any thriving community. Just knowing that a competent hospital is available in your area provides tremendous peace of mind, could influence a young couple to stay in a community, and may benefit property values. Most provide emergency care 24/7, and they are staffed with the medical and nursing professionals necessary to address illnesses and accidents. These services and staff are beneficial to keeping a community growing.

A special type of municipal bond, hospital revenue bonds support construction or equipment upgrades for nonprofit hospitals. Because over half of the hospitals in the United States are recognized as nonprofits, there is a high chance that members of your community use these hospitals (and maybe even you!). Furthermore, nonprofit hospitals are required to provide community benefits that are evidence-based and proven community health initiatives. The overall goal is to create a healthier population that does not need to visit the hospital as often.

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Life Care

Life care organizations, such as nursing homes, provide many more services than you might realize. In addition to care for chronically ill or terminal patients, life care organizations also offer patients a venue for rehabilitation with injuries, illnesses, or general care outside of a traditional hospital setting. According to the CDC, there are currently 1.4 million U.S. residents in nursing home care.

Muni bonds can help fund the construction and maintenance of these crucial life care facilities. Although they are similar to healthcare bonds, life care bonds do not entail the reimbursement issues related to Medicare, because many of them are private pay facilities. By investing in these bonds, you are helping to provide care for the members of your community who deserve it the most.

Nursing

Fact: nurses are real-life superheroes. And we need them more than ever! Nursing is projected to be one of the top occupations for job growth through 2022, due in part to the growing healthcare needs of the Baby Boomer generation.

We want our healthcare professionals to be very well educated, right? And that goes for our nurses too. Fortunately, muni bonds are great backers for educational organizations, and that goes for nursing schools as well. For instance, bonds recently helped fund Arizona State University’s College of Nursing and Health Innovation.

Risks

As with any investment, municipal bonds carry a degree of risk. In healthcare in particular, there have been reports of hospital credit downgrades in recent years. It’s important for you as a potential investor to weigh these risks against the potential benefits of muni bonds.

Good health is not something we can buy. However, it can be an extremely valuable savings account. — Anne Wilson Schaef

Closing Thoughts

Overall, in the past ten years, the municipal bond health care index has found that U.S. bonds in the hospital, life care, and nursing sectors have been stable. There is a general trend toward increasing annual returns. Just thinking finance-wise, the nonprofit health care sector has served as a source of yield for approximately a decade.

By investing in healthcare bonds, you can help fund hospitals, life care facilities, and nursing schools in your favorite community. This helps ensure that your neighbors – and you! – have access to excellent healthcare facilities whenever the need arises. And that peace of mind is priceless.

Lindsay Mack

Lindsay Mack is a business writer based in New Orleans. A book geek with an MBA, she loves helping others succeed.

Lindsay MackGood for What Ails You: Muni Bonds & American Healthcare

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