Magellan Health Inc. (MGLN) is one stock that looks appealing with its strong fundamentals and improving prospects.
Arotech, Cooper Companies, UnitedHealth Group, Aetna and Humana highlighted as Zacks Bull and Bear of the Day
Arotech, Cooper Companies, UnitedHealth Group, Aetna and Humana highlighted as Zacks Bull and Bear of the Day
UnitedHealth (UNH) looks well positioned for growth in 2017 by virtue of its diversified business in the health insurance space, exit from Exchanges for 2017 and high-growth Optum business.
Aetna Inc. (AET) has been grappling with a number of issues of late, which are clearly reflected in its share price underperformance relative to the sector.
Coauthored by David Squires This was a tumultuous year in health care and elsewhere. Wherever we looked, the improbable and unbelievable became true and believable: from Brexit to a President-elect Trump to alleged foreign sabotage of our political institutions. Historians will dissect the remnants of these events for decades. For us, for now, let's focus on health care, which is plenty. Trump (and the Republicans) emerge ascendant. President-elect Donald Trump will take the oath of office on January 20, 2017, joined by Republican majorities in both houses of Congress, 68 of 99 state legislative chambers, and 31 of 50 governorships. The Republican Party's commitment to repealing and replacing the Affordable Care Act could not be clearer, but stubborn political realities and technical issues are already forcing Congress to consider delaying the effective date of any repeal by up to four years. Though Republicans can accomplish a repeal without any help from Democrats (using the budget reconciliation process), patching together a replacement package will require eight Democratic votes in the Senate. That will be a challenge, as will managing the transition and finding consensus among divided Republicans on how or whether to cover the more than 20 million Americans who will likely lose insurance if the ACA is repealed. Next year is likely to be fascinating for national health policy, both technically and politically. More important, the lives of tens of millions of Americans will be deeply affected by what the new Republican majority tries to do -- and is able to accomplish. Uninsured rate hits historic low. During 2016, the proportion of Americans lacking health insurance reached an historic low: 8.9 percent. Since 2010, the number of Americans without insurance has fallen by more than 20 million. The result: fewer medical bill problems and more accessible and affordable care for patients, and less uncompensated care for providers. Premium increases and insurer exits raise concerns about ACA marketplaces. This was a turbulent year for the individual health insurance market. A number of high-profile insurers exited the marketplaces created under the Affordable Care Act. Double-digit premium increases in some marketplaces added to concern about their stability. However, the impact of these premium spikes on marketplace customers was dampened by federal subsidies that absorbed the costs for more than 80 percent of purchasers. And some of the premium growth likely reflected one-time adjustments to the expiration of time-limited federal programs (reinsurance, risk corridors) that had buffered insurers against unpredicted health expenditures among their new customers. While fears of marketplace collapse are overblown, these developments do signal the need for reforms in the ACA, should it survive the swelling efforts to repeal it. Another point to keep in mind: in the employer-sponsored insurance market, where the majority of Americans get their insurance, premium growth has actually slowed since the passage of the Affordable Care Act. With MACRA looming, value-based payment spreads. The Centers for Medicare and Medicaid Services issued the final regulation implementing the Medicare Access and CHIP Reauthorization Act (MACRA) in 2016. MACRA will transform how Medicare pays clinicians and accelerate trends toward value-based payment, which is designed to pay for the value rather than the volume of services. As of early 2016, 30 percent of Medicare payments were tied to "alternative payment models," as were 25 percent of private insurers' payments. Whether the new administration will be as committed to payment reform as the departing one remains to be seen. The Innovation Center takes off the gloves. One player driving this payment transition assumed a more prominent role in 2016. The Center for Medicare and Medicaid Innovation (CMMI), created under the ACA, has broad authority to experiment with how our largest public insurance programs pay for services. This year, they took a fair amount of heat for making providers' participation in some of their payment experiments mandatory rather than voluntary, and were forced to abandon one demonstration reducing payments for medications under Part B of Medicare. Rep. Tom Price (R-Ga.), Mr. Trump's nominee for Secretary of Health and Human Services, has been a vocal critic of CMMI and its mandatory payment demonstrations. He seems likely to scale back some of its programs, and a repeal of the ACA could eliminate CMMI altogether. However, a Secretary Price might also find some of CMMI's broad authorities to be useful once he settles into his new office. Bipartisan bill reforms FDA, increases R&D. The 21st Century Cures Act, a rare bipartisan initiative, was passed by Congress and signed by President Obama in 2016. The bill increases funding for the National Institutes of Health, including for pioneering cancer and genomic research, and reforms and boosts funding for the Food and Drug Administration's approval process for pharmaceuticals and medical devices. The new law also dedicates $1 billion over the next two years to fight the opioid scourge devastating much of the country. Little-heralded features of the law promote interoperability among electronic health records, and consumers' access to their own digital health records. Insurer mergers prompt an antitrust reckoning. Four of the country's largest insurers are trying to become two, but not if the current Justice Department has anything to say about it. In July 2016, U.S. Attorney General Loretta Lynch sued to block the Humana-Aetna and Anthem-Cigna mega-mergers, arguing that they would reduce competition and raise prices for consumers. Outrage over drug pricing yields smoke, but no fire, at least not yet. Sovaldi, Daraprim, Epipen--a spate of drug-pricing stories continued to grab headlines in 2016. Resulting congressional inquiries yielded numerous verbal floggings for drug company executives, but no concrete action to quell Americans' rising anger over their out-of-pocket spending for pharmaceuticals. President-elect Trump has pledged to control drug prices. Polls show that large majorities of the American public favor having Medicare negotiate drug prices, allowing drug reimportation from Canada, and other aggressive policies to reduce the growth in pharmaceutical spending. However, with Republicans in the majority, and pharma's lobbying muscle undisputed, the prospects of new legislation to deal with drug costs remain uncertain at best in 2017. Americans' lives are shortening. Finally, we learned this month that our life expectancy is going in the wrong direction. Though the change was small--a decline of about one month--it is just the latest evidence of disturbing deterioration in the general health of Americans, particularly working-class whites. The idea that for the first time in U.S. history our children may be less healthy than we are is deeply alarming, and should make improving the health of Americans a major national priority. Here's hoping for a happy, productive, and HEALTHIER new year. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.
On Dec 27, we issued an updated research report on Aetna Inc. (AET).
UnitedHealth (UNH) has been able to beat all kinds of industry odds to emerge as a winner.
On Dec 19, 2016, Zacks Investment Research downgraded Humana Inc. (HUM) to a Zacks Rank #3 (Hold).
Obamacare has failed the American people, and things are only getting worse by the day: Even higher premiums. People who have signed up for the benchmark Obamacare plan will pay, on average, 25 percent more in premiums next year. That is more than three times the increase for 2016. On top of all that, the quality of the coverage is worse than expected. Americans are, in effect, paying more for less than what they were promised. Even higher deductibles. On one of the least expensive types of plans, deductibles for both individuals and families are going up by about 15 percent. Deductibles have gotten so high that it is essentially the equivalent of not even having health insurance. An even bigger bill for taxpayers. Because premiums have skyrocketed so much, so have the subsidies needed to prop up Obamacare. According to one independent study, taxpayers will pay nearly $10 billion more for subsidies in 2017. Even fewer choices. For 2016, only 2 percent of eligible customers had one insurer to choose from. For next year, that number has jumped to 17 percent. All of these trends are heading in the wrong direction. The trajectory we are on points to the likely possibility that Obamacare is already in what experts call a “death spiral,” where there is such little competition that costs skyrocket and the market collapses. Here's what Doug Badger of the Galen Institute wrote earlier this month: “Obamacare already is in a death spiral that is fast approaching its terminal point. That is because, despite billions in individual and corporate subsidies, insurers are bleeding money. … And 2015 will be remembered as Obamacare’s good old days. Since then, four of the country’s five largest insurers — Aetna, Humana, Cigna and UnitedHealthcare — have all but abandoned the exchanges. The fifth, Anthem, saw its stock price spike upwards last month minutes after its CEO told investors that his company might pull out in 2018. ... The insurer exodus has left more than one in five Americans with an exchange in which only one company participates. The consequences of dumping all the bad risks onto a single insurer are entirely predictable — that insurer will drop out of the market, leaving no insurers in the exchange. The program’s death spiral is irreversible.” The very real possibility of a death spiral picked up last spring, when insurers warned that their losses from Obamacare were “unsustainable.” The Hill reported on April 15: “Insurers say they are losing money on their ObamaCare plans at a rapid rate, and some have begun to talk about dropping out of the marketplaces altogether. … While analysts expect the market to stabilize once premiums rise and more young, healthy people sign up, some observers have not ruled out the possibility of a collapse of the market, known in insurance parlance as a ‘death spiral.’” Sure enough, as the summer unfolded and premium increases piled up, the death spiral began to take shape: “Obamacare ripples through Texas as health insurers propose steep rate hikes. … ‘The individual market is a market of last resort ... And that's not how it used to be,’ said Janna Hamstra, a benefits consultant in San Antonio whose firm, Hamstra Benefit Solutions, advises employers across Texas. ‘In our industry, they call it the death spiral ... As those premiums keep escalating, healthier individuals decide to self insure,’ she said.” (Houston Chronicle) “[Princeton University health economist Uwe Reinhardt] offers an especially thoughtful explanation of why he believes the Obamacare marketplaces won’t work. ‘Liberals think this will settle itself. Eventually, though, we all know about the death spiral that actuaries worry about, and I think what you’re seeing now is a mild version of that. These things accelerate, as premiums keep rising.’” (Vox) “‘I think what we should be expecting is premiums that are substantially higher, and I think there’s a real risk that other insurers pull out,’ said Michael Morrisey, a professor at the Texas A&M University School of Public Health. ‘We may be beginning to see the death spiral of insurance plans in the exchanges.’” (Texas Tribune) “Jeffrey Anderson, a senior fellow at the conservative Hudson Institute, said that the problem is that there is a high likelihood that no young people will ever sign up for Obamacare. ‘There are too many loopholes, too many ways to get around paying if you don't get insurance,’ Anderson told Business Insider. For this reason, Anderson does not believe that Obamacare will ever work and shows it is in a ‘slow-motion death spiral.’” (Business Insider) “‘That’s going to be the future,’ said Roger Stark of the Washington Policy Center in Washington State. ‘What we’re seeing here is the beginning of a death spiral as far as exchanges are concerned as more companies pull out.’” (Fox News) “Democratic lawmakers pushing 'public option' amid ObamaCare woes. … ‘I think we're seeing the public option come back out of desperation,’ said Douglas Holtz-Eakin, president of the conservative American Action Forum. ‘We’ve seen UnitedHealthcare groups, the Aetnas of the world withdraw from exchanges. … As a result, the kinds of people buying insurance there have very expensive medical bills -- insurers are losing money, as they try to cover those bills, jacking up the premiums, people move to other policies so it’s turning into the death spiral that everybody worried about,’ said Holtz-Eakin.” (Fox News) Indeed, even Democrats knew Obamacare was unraveling, and began plotting to impose government-run health care. Now they are digging in to defend the status quo. But the answer isn’t to ignore the problem. The situation is too dire. The time to act is now. This is the third piece in an ongoing series. Part 1: Repeal Is Relief Part 2: ObamaCare Has Failed
UnitedHealth Group's (UNH) upcoming senior unsecured notes of $1.5 billion recently received rating action from A.M. Best. The rating giant has assigned a Long-Term Issue Credit Rating of ???bbb+??? to the same.
The Ensign Group, Inc. (ENSG) recently announced that its urgent care unit, Immediate Clinic Seattle, Inc., has completed its asset sale deal with not-for-profit health care organization,
On Dec 15, 2016, we issued an updated research report on Molina Healthcare Inc. (MOH).
Community Health Systems, Inc. (CYH) recently announced that its subsidiaries have entered into a definitive agreement with Sunnyside Community Hospital & Clinics
Aetna Inc. (AET) recently came under fire for having allegedly pulled out of Affordable Care Act (ACA) exchanges in 11 states, including the areas covered by the Justice Department lawsuit, in a bid to avoid antitrust claims.
Humana Inc. (HUM) recently announced its decision to write off its receivables of $591 million associated with the risk corridor premium stabilization program outstanding as of Sep 30, 2016.
Humana Inc. (HUM) recently announced that it has entered in to a value-based agreement with population health leader, FullWell