Health-Care Companies Are Infected by Severe Case of Washington Jitters

A wide swath of nursing-home companies and other health-care providers are getting rattled by the political drama in Washington.

On Monday, Medicare’s plan to cut nearly $4 billion dollars in spending to nursing-home operators—an attempt to correct flaws in the agency’s reimbursement rates—spooked a health-care industry already on edge from the increased scrutiny of government spending.

The growing push to rein in health-care costs, as indicated by the debt debate, weighed on the entire health-care sector, especially those companies that would feel the bite of Medicare cutbacks most directly, such as hospitals. Affected groups warned of poorer medical care for …

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