Under President Trump’s ‘Great Healthcare Plan,’ money will directly be delivered to people to purchase their healthcare.
- The President however did not provide details such as who will be eligible or how much money consumers could receive.
- Trump also called for more transparency from insurance companies regarding claim payouts, denials and prices.
- According to analyst Cantor Fitzegerald, the Trump administration's "Great Healthcare Plan" proposal is a favorable outcome for the medical insurers as the proposed mandates for insurers "are nothing new or disruptive."
Shares of insurance companies closed up on Thursday after President Donald Trump unveiled a healthcare initiative aimed at reducing insurance premiums.
UnitedHealth (UNH) shares closed up 1% on Thursday, while CVS Health (CVS) and Cigna (CI) closed nearly 3% higher.
Under President Donald Trump’s ‘Great Healthcare Plan,’ money will directly be delivered to people to purchase their healthcare.
“My plan would reduce your insurance premiums by stopping government payoffs to big insurance companies and sending that money directly to the people,” Trump said, while also calling on the Congress to pass the framework without delays. The President, however, did not provide details as to who would be eligible or how much money consumers could receive.
Trump also called for more transparency from insurance companies regarding claim payouts, denials and prices.
“It requires insurers to publish detailed information about how much of your money they’re going to be paying out in claims versus how much they are taking in in profits… It forces them to release detailed data on how many claims are being denied and whether those denials are eventually overturned on appeal,” Trump said.
Experts Weigh In
According to analyst Cantor Fitzgerald, the Trump administration's "Great Healthcare Plan" proposal is a favorable outcome for the medical insurers. The proposed mandates for insurers "are nothing new or disruptive," the analyst told investors in a research note.
Cantor believes the bill's implications are more around rebranding than a structural change in business operations. It sees the bill as a net positive for UnitedHealth (UNH), Elevance Health (ELV), Cigna (CI), Humana (HUM), CVS Health (CVS), Centene (CNC) and Molina Healthcare (MOH). The firm believes it is "far too late" into Trump's second term for a meaningful healthcare policy overhaul.
Wells Fargo, meanwhile, said the "The Great Healthcare Plan" released by the White House, will likely face a difficult path forward. In addition, lack of "new onerous proposals could be viewed as positive" for the healthcare services group, the analyst told investors in a research note.
How Did Stocktwits Users React?
On Stocktwits, retail sentiment around UNH and CVS stocks trended in the ‘bearish’ territory at the time of writing, while sentiment around CI stayed at ‘bullish’ levels.
UNH shares lost nearly 38% over the past 12 months while its rival CVS added more than 50%.
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