How insurers flipped a Medicare pay cut into a pay raise
Monday afternoon was a really great time to be a health insurance plan. Right before 4 p.m., the industry's stocks all skyrocketed upward. Humana, Aetna, Cigna, UnitedHealth—the companies represented in chart above—all saw big increases. They did so with good reason: the Obama administration reversed a proposed 2.3 percent pay cut for private Medicare plans, replacing it with a 3.3 percent raise. For health plans, this was a huge victory. As Citi analyst Carl McDonald put it in a Tuesday note to investors, this was "Armageddon averted." "The rate adjustment," McDonald continues, "sends a pretty clear message that CMS has no interest in seeing major disruption in the Medicare Advantage program right now, quieting concerns about a post election desire to rein in enrollment and margins."
- Senators Hear How Two-Midnight Rule Harms Patients, Hospitals
- 3 Management Lessons from a Supermarket Debacle
- Handshaking Spreads Germs. Get Over It.
- Healthcare Costs Start With What We Eat
- Hospitals Likely to Outsource ICD-10 at Launch
- IOM Identifies GME Problems, Calls for Finance Changes
- CMS Confirms ICD-10 Deadline
- Anatomy of 3 Health System Rebranding Efforts
- Premium Subsidy Fight Creating Uncertainty for Hospitals, Health Plans
- Medicare Advantage Carriers See 'No Choice' But to Accept Cuts