So what if Medicare cuts payments to the old folks homes. HCP still has lease contracts with those joints that can't be changed over night. What are they going to do, dump granny into the street? So why the big stock plunge?
Because of the risk that the cuts will bankrupt the nursing home operators. Coming soon to a street near you: attack of the demented grannies!
Long term this may have a neg. impact. Leases(rents) will come down, thus, more than likely, so will income, which could reduce the div.
As long as the dividend is not cut who cares