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News

Healthcare Investors Bet On Easier Medicare Rules Under Potential Trump Administration

Author: Michael Juliano | July 17, 2024 04:09pm

Healthcare investors are expecting Republican presidential nominee Donald Trump to ease regulations on Medicare Advantage if the former president wins and returns to the White House.

Under the Biden administration, the Centers for Medicare & Medicaid Services has hardened its stance on the program after it faced criticism for insurers overbilling the government and denying care to seniors too many times, the Wall Street Journal reported.

Republicans tend to favor privatizing government services and have been friendlier to Medicare Advantage plans, a trend that investors are betting could continue under a second Trump administration. 

Also Read: UnitedHealth Analysts Boost Their Forecasts Following Upbeat Earnings

Regulatory easing on Medicare Advantage could also rekindle talks on possible mergers between health insurers. The Cigna Group (NYSE:CI) and Humana Inc. (NYSE:HUM) have discussed merging, but they backed away from the deal over antitrust issues and worries over Medicare, the Journal reported in November.

Price Action: The health insurance sector gave mixed results on Wall Street. United Healthcare Group Inc. (NYSE:UNH) gained 4.44% to $573.28, while Elevance Health, Inc. (NYSE:ELV) dropped 5.95% to $520.21 and Cigna rose 1.49% to $344.76 on Wednesday.

Exchange-traded funds that hold health insurer stocks, however, trended upward.

  • iShares U.S. Healthcare Providers ETF (NYSE:IHF) edged up 0.11%
  • The Health Care Select Sector SPDR Fund (NYSE:XLV) went up 0.45%
  • Global X Dow 30 Covered Call & Growth ETF (NYSE:DYLG) inched up 0.25%
  • SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA) gained 0.55%
  • iShares U.S. Healthcare ETF (NYSE:IYH) ticked up 0.33%.

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Posted In: CI DIA DYLG ELV HUM IHF IYH UNH XLV

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