Friday, March 23, 2007

House Ways and Means Health Subcommittee Goes After Medicare Advantage Payments on Wednesday and Humana Stock Up 5% by Thursday Close

Apparently Wall Street doesn’t take Pete Stark and the Congressional Democratic Majority very seriously.

The House Ways and Means Health Subcommittee held hearings on Medicare Advantage payments to HMOs on Wednesday morning. It’s no secret the Democrats have every intention of cutting those payments.

No health plan has made the strategic bet on the Medicare Advantage program that Humana has. And nothing has driven the HMOs earnings more than the private Medicare business.

Between noon on Wednesday and the Thursday close, the stock had gone from $57 to almost $60—an increase of 5%!

Wall Street is wrong.

Earlier posts:

Medicare Advantage HMOs Gearing Up For Payment Cuts--Could They Come as Early as 2008?

If Medicare Advantage Rates Are Going to Be Cut, Why Have the Big Medicare HMO Stock Prices Been Up Since the Election?
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