Confession: I’m one of those guys who avoids regular doctor visits.

I realize that at my age—I turned 44 this month—this is a foolish choice, even though I swim three times a week and run on the days I don’t get to the pool. There’s just no beating the care you get from a medical professional.

Until age 44, accidents are the most likely cause of death in men. But 45 is a critical threshold; at that point, heart disease takes the top spot, killing 36,000 forty-something men every year.

And scientists at the University of California at Irvine have discovered that men over 40 are up to two times more likely to develop melanoma than women of the same age. I’ve already had a bout of basal-cell skin cancer.

What I need to do is get myself to a doctor and get a physical.

I’m sure there are lots of guys like me around the U.S. But there are also lots of other people—newly covered by health insurance via the Affordable Care Act—who won’t be so cavalier about their well-being.  They’ll get a jump on prevention before they have to worry about a cure.

That’s just one trend working in favor of new Consiervative Holding Sonic Healthcare Ltd. (ASX: SHL, OTC: SKHCF), the world’s third-largest medical testing and diagnostics services provider, behind Quest Diagnostics and Laboratory Corp of America. But Sonic stands apart because it’s the only truly global player, with major operations in the U.S., the U.K., Germany and Switzerland, in addition to its core Australia/New Zealand market.

The firm gets 21% of its revenue from the U.S., where it controls roughly 6% of the diagnostics market. That, plus its presence in other countries, is a big plus because the weakening Australian dollar boosts the value of its sales in those markets.

Ready for Medicare Cuts

Much has been made of cuts to Medicare spending in the U.S. and the potential impact on medical diagnostics companies such as Sonic.

U.S. lab firms are only just coming to terms with a combined 4.95% cut to the clinical laboratory fee schedule (CLFS) introduced on January 1, 2013. In addition, the Center for Medicare and Medicaid Services (CMS) has proposed combined cuts to the physician fee schedule (MPFS) of 26%, plus a comprehensive review of the CLFS.

The headline reduction of 26% to the MPFS is relatively benign for Sonic, as it applies to just 3% to 4% of the company’s U.S. revenue. But the chance of further cuts to the CLFS—which governs roughly 16% of the company’s U.S. revenue—is a greater worry.

A report by the U.S. Department of Health and Human Services found that Medicare paid anywhere from 18% to 44% more than state Medicaid plans or private insurers for lab tests.

CMS now plans to launch a five-year review to examine whether reimbursements for about 1,250 lab tests on the CLFS are reasonable in light of the efficiency improvements and new technology now used to conduct them. An average CLFS cut of 20% would reduce Sonic’s after-tax net profit by 3.5%.

However, Sonic, like Quest and LabCorp, isn’t waiting around for the CMS to make a decision: It continues to cut its costs to account for present and future funding reductions, which will likely bedevil the market for some time.

And at the end of the day, all three companies will likely benefit as funding pressures force smaller labs to close, sending more work to larger facilities. And don’t forget about those additional Americans ready to use their coverage under the ACA, boosting Sonic’s volumes.

Something else you shouldn’t overlook? The company’s operations outside the U.S. continue to perform well. Its main market, Australia and New Zealand (47.9% of revenue), saw a 5.2% sales increase in fiscal 2014, while Germany (19% of revenue) reported a 31.7% sales jump. The company is also seeing accelerating volume growth in the U.S.—a very encouraging sign after a number of tough years.

Tapping the Outsourcing Trend

For fiscal 2014, Sonic’s net profit rose 14.9% from fiscal 2013, to AUD385 million, as revenue gained 12.3%, to AUD3.9 billion.

The company declared a final dividend of AUD0.40, bringing the total payout for the year to AUD0.67, up 8.1% from fiscal 2013.

Sonic continues to spot new growth opportunities as health care providers look to improve services and cut costs by outsourcing to established private providers. The company is well positioned to capitalize on this trend, thanks to its strong reputation, solid infrastructure and experience operating in eight countries.

Meanwhile, fee pressures in some markets appear to have abated, and Sonic continues to generate substantial cash flow.

For all of fiscal 2015, the company is forecasting a roughly 5% increase in earnings before interest, taxation, depreciation and amortization.

To be sure, the changing U.S. health care market presents challenges, but the company’s position is well established, and it could actually benefit from these policy changes in the long run. Meantime, its growth in Australia and Europe remains solid.

Sonic Healthcare, which is yielding 3.7%, is a buy under USD17 on the Australian Securities Exchange (ASX) using the symbol SHL and on the U.S. over-the-counter (OTC) market using the symbol SKHCF.

Sonic also trades as an American depositary receipt (ADR) on the U.S. OTC market under the SKHCY symbol. Sonic’s ADR, which is worth one ordinary ASX-listed share, is a buy under USD17.