March 14 Shares of hospital stocks were sharply
lower in early trading on Tuesday after the U.S. Congressional
Budget Office forecast that 14 million Americans would lose
medical insurance by next year under a Republican plan to
Shares of HCA Holdings fell 1.8 percent, Tenet
Healthcare fell 4.6 percent, Community Health Systems
was down 2.8 percent and LifePoint Health was
down 1.9 percent.
The S&P 500 healthcare sector was off 0.16 percent.
"While the CBO's estimate... is a negative headline for
hospitals, we believe that in its current form, the bill's
chances of passing are slim," Jefferies analyst Brian Tanquilut
said in a research note.
Tanquilut said he believed legislators "will eventually
draft a more palatable, diluted version of 'repeal and replace'
that would have a smaller impact on the number of uninsured."
The Affordable Care Act of 2010 expanded medical coverage,
aiding hospitals by reducing the number of uninsured patients
who could not pay bills. Hospital stocks sold off after the Nov.
8 presidential election of Donald Trump, who vowed to repeal
former President Barack Obama's signature domestic policy
The CBO forecast that 24 million people would be uninsured
in 2026 if the plan being considered by the House of
Representatives were adopted. Some health policy experts and
Wall Street analysts said the report was more draconian than
expected, with the uninsured rate declining more quickly than
Health insurer stocks also fell, though their moves were
UnitedHealth Group Inc was down 0.2 percent, Aetna
Inc down 0.5 percent and Humana Inc down 0.1
(Reporting by Megan Davies; Editing by Dan Grebler)