US 2.48% Medicare Advantage increase for 2027 lifts insurers stocks
Business
Big news for health insurance: US insurance stocks shot up after the government announced a 2.48% increase in payments to private insurers for 2027.
This means the increase could add up to over $13 billion in additional payments to Medicare Advantage plans next year, a welcome relief for companies dealing with rising health care costs.
UnitedHealth Group Humana CVS Health rally
UnitedHealth Group shares climbed 10%, Humana jumped 13%, and CVS Health rose 8% after the announcement.
Analysts were expecting only a modest bump, so this surprise hike is seen as a win for the industry.
As analyst Chris Meekins put it, these higher payments could pave the way for two years of earnings growth, a much-needed boost after the market drop earlier this year.