"Capital," Maxwell Emery (Hume Cronyn) said in the finance film Rollover (1981), "has a life of its own."

The market absolutists and conservatives who oppose health care reform are going to find out just how much havoc that capital force can generate in the years ahead, as it relates to health care costs.

One of President Obama's accomplishments during his first 100 days was the passage of a $787 billion stimulus plan. I think the idea of economic stimulus makes sense when an economy is in the middle of a deflationary spiral. As I posted, that's when a drop in demand leads to excess productive capacity, causing companies to cut prices and fire workers, which in turn lowers demand as more workers -- whose consumer spending accounts for 70% of GDP growth -- have less to spend.

So far, only about 10% of the stimulus money has been doled out and it's not having much effect in counteracting this deflationary spiral. How so? First quarter GDP plunged 6.1% -- compared to a 6.3% decline in 2008's fourth quarter -- and the preliminary numbers are usually adjusted downward. The unemployment rate is expected to hit 8.9% in April from 8.5% in March.

Amgen Inc. (NASDAQ: AMGN) is higher today on reports that the U.S. Senate has passed a resolution requesting that the Centers for Medicare & Medicaid Services start reconsidering the final National Coverage Determination issued July 30 on anemia drugs for cancer patients, including Amgen's Epogen and Aranesp. If you think this means that the company won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on AMGN.

After hitting a one year high of $77.00 in October, the stock has slipping over the past year, touching a 52-week low of $48.30 in mid-August. AMGN opened this morning at $53.23. So far today the stock has hit a low of $52.15 and a high of $53.39. As of 11:05, AMGN is trading at $52.22, up $0.88 (1.7%). The chart for AMGN looks bearish and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider an October bull-put credit spread below the $47.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in just 6 weeks as long as AMGN is above $47.50 at October expiration. Amgen would have to fall by more than 9% before we would start to lose money.

HealthSouth Corporation (NYSE: HLS), the Alabama-based rehabilitation company, is close to completing a massive restructuring after years of tough times.

New management, three divestitures to be completed by the end of 2007 and a soon-to-be-more-friendly approach from Medicare and Medicaid, should allow this stock to perform nicely during the next three-to-five years.

HealthSouth was a boom-bust stock as former CEO Richard Scrushy built the diversified healthcare company into one of the larger and faster growing healthcare companies in the US during the 1990s. However, a number of financial irregularities came back to haunt Scrushy and his shareholders, leading to the stock tanking.

New management was brought in earlier this decade--well-respected execs from HCA--who first had to address the legal and accounting issues that plagued the company. Then last year the company announced it would begin selling non-core assets and become a focused rehab business.

The divestitures are for the most part completed and now the last part of the puzzle needs to be put in place. Medicare and Medicaid need to get the correct reimbursement rates so this very important industry can serve customers effectively and earn a return on investment. As boomers get older and stay more active, the rehab service that HealthSouth provides will become more and more important.

HealthSouth's stock ran up to $25 in anticipation of its three divestitures but has sold off to $20.50. Use this weakness to buy the stock, this could be a multi-bagger in the next few years.