A proposal for lower-than-expected Medicare Advantage charges in 2024 has despatched shares of publicly traded well being insurers falling.
UnitedHealth Group Inc.’s
UNH,
inventory fell 1.2% in buying and selling on Thursday, shares of Elevance Health Inc.
ELV,
have been down 3.3% and Molina Healthcare Inc.’s
MOH,
inventory tumbled 1.6%. Centene Corp.’s
CNC,
inventory was down 3.0%, shares of Cigna Corp.
CI,
dropped 2.2% and Humana Inc.’s
HUM,
inventory declined 3.3%.
The Centers for Medicare and Medicaid Services on Wednesday proposed new Medicare Advantage charges for 2024, together with a core fee enhance of two.09%. Rates have averaged 3.3% over the previous 5 years, in keeping with Oppenheimer analyst Michael Wiederhorn. A ultimate determination is predicted April 3.
“While the result is disappointing, the industry has been the beneficiary of some healthy increases in recent years,” Wiederhorn informed buyers. “Additionally, we note that over the last five years, the final rule has come in 1.0% better than the proposal, on average.”
Mizuho Securities analysts famous that the speed is decrease than anticipated however nonetheless view the proposal as optimistic for managed-care corporations.
“While the lower rate [year over year] could impact benefits offered to Medicare beneficiaries, we believe it will allow the industry to continue to grow in the high-single digits,” Mizuho analyst Ann Hynes wrote in an investor observe. “While the Biden administration has discussed potential reforms to Medicare Advantage, we do not believe the Biden administration will make major structural changes to the MA program this year.”
The Health Care Select Sector SPDR ETF
XLV,
was additionally down about 1% in buying and selling on Thursday morning.
Source web site: www.marketwatch.com
