The stock price of UnitedHealthcare on the New York Stock Exchange saw a sharp fall after the Wall Street Journal reported Monday that the Donald Trump administration has proposed to keep Medicare rates flat for the next year.
WSJ reported that the US federal government has proposed an increase of just 0.09% increase in interest rates for insurers next year. Later, the Centers for Medicare and Medicaid Services confirmed the rates for 2027 in a release.
All major US insurance companies, including the UnitedHealthcare group, saw a sharp decline in stock prices in the market afterhours Monday. UnitedHealtcare and CVS Group - two of the major health insurance companies in the US- saw share prices falling by over 8%. Humana, meanwhile, saw over 10% fall in stock prices by the end of market hours.
According to the Wall Street Journal, the Centers for Medicare and Medicaid Services, under which the Medicare and Medicaid rates fall, will announce the new Medicare rates later this week.
CVS, which was trading at $83.87 on the New York Stock Exchange at the end of Monday's trade, fell by over 10.9% in the market hours. As of this writing, it is trading at $74.70 per share.
{{/usCountry}}CVS, which was trading at $83.87 on the New York Stock Exchange at the end of Monday's trade, fell by over 10.9% in the market hours. As of this writing, it is trading at $74.70 per share.
{{/usCountry}}UnitedHealthcare, which saw a 1.32% fall in the day's trading, closing at $351 at 4 p.m. ET on Monday, dropped to $320 in the after-hours. Humana closed at $263 per share on Monday. But in the after-market hours, it fell to $228 - over 13%.
Overhaul In Billing System Announced
The Wall Street Journal report also noted that the new rate proposal from the Trump administration has also sought an abolition of a popular billing practice, which makes it less client friendly.
A Medicare official quoted in the report stated that the agency wants to simplify the billing system to strengthen competition.
“These proposed payment policies are about making sure Medicare Advantage works better for the people it serves,” CMS boss Dr. Mehmet Oz said.