{"id":13033,"date":"2026-01-29T08:02:59","date_gmt":"2026-01-29T08:02:59","guid":{"rendered":"https:\/\/diyhaven858.wasmer.app\/index.php\/unitedhealth-stock-plunges-leads-insurers-lower-after-trump-medicare-spending-plan-surprise\/"},"modified":"2026-01-29T08:02:59","modified_gmt":"2026-01-29T08:02:59","slug":"unitedhealth-stock-plunges-leads-insurers-lower-after-trump-medicare-spending-plan-surprise","status":"publish","type":"post","link":"https:\/\/diyhaven858.wasmer.app\/index.php\/unitedhealth-stock-plunges-leads-insurers-lower-after-trump-medicare-spending-plan-surprise\/","title":{"rendered":"UnitedHealth stock plunges, leads insurers lower after Trump Medicare spending plan surprise"},"content":{"rendered":"
\n<\/p>\n
\n
The health insurance sector saw a deep sell-off Tuesday, led by a plunge in UnitedHealth Group (UNH) shares, as the Trump administration proposed a lower-than-expected increase to 2027 Medicare Advantage plans.<\/p>\n
In a report published Monday night by the Centers for Medicare & Medicaid Services (CMS), the administration proposed that payment rates for Medicare Advantage plans (private insurance plans) will rise by just 0.09% in 2027. Analysts were expecting an increase of as much as 6%.<\/p>\n
UnitedHealth (UNH) lost nearly 20%, while fellow major insurers Elevance Health (ELV) and CVS (CVS) each shed around 14%.<\/p>\n
The smaller-than-expected proposal comes as margins are already tight for insurers. When UNH reported earnings Tuesday morning, the company said its Medical Care Ratio sat at 89.1%. Other insurers have reported similar rates.<\/p>\n
The MCR is a key metric that measures the percentage of premium revenue spent on medical claims and healthcare services for policy members. In UNH’s case, the company uses $0.89 of every dollar the company makes from the premiums it charges customers to pay for medical care.<\/p>\n
Read more: Live coverage of earnings season<\/em><\/p>\n
UnitedHealth has the largest exposure among insurers to Medicare Advantage changes, accounting for roughly 30% of enrollment nationally. Humana (HUM), which comes in second with roughly 17% of national enrollment, also saw shares plunge over 20% on Tuesday.<\/p>\n
The tiny increase for 2027 comes after the insurance got a 5.06% increase for 2026, higher than expected. Final numbers for 2027 are scheduled to be finalized on or before April 6, according to William Blair analysts.<\/p>\n
In a statement released after the CMS report, a spokesperson for the insurance industry group AHIP said that, if the proposal is to be implemented, it “could result in benefit cuts and higher costs for 35 million seniors and people with disabilities when they renew their Medicare Advantage coverage in October 2026.”<\/p>\n
The proposal “represents an additional headwind for the [Medicare Advantage] sector, further pressuring industry fundamentals,” William Blair analysts wrote in a note to clients published on Tuesday.<\/p>\n\n
\n
<\/div>\n<\/div>UNITED STATES – JANUARY 22: UnitedHealth Group CEO Stephen Hemsley arrives to testify to the House Energy and Commerce Committee Health Subcommittee hearing on “Lowering Health Care Costs For All Americans: An Examination Of Health Insurance Affordability” in the Rayburn House Office Building on Thursday, January 22, 2026. (Bill Clark\/CQ-Roll Call, Inc via Getty Images) \u00b7<\/span> Bill Clark via Getty Images<\/span><\/figcaption><\/figure>\n
UnitedHealth, the country’s largest insurer, took a secondary hit Tuesday morning when the company reported fourth quarter and full-year 2025 revenues that came in below expectations.<\/p>\n
Fourth quarter and full-year revenue came in at $113.2 billion and $447.6 billion, respectively, compared to estimates of $113.7 billion and $447.9 billion. Both fourth quarter and full-year revenues were up 12% against the previous year.<\/p>\n<\/p><\/div>\n
\n
The healthcare giant said it expects 2026 revenue to be above $439 billion, which would reflect a 2% year-over-year decline attributed to \u201cright-sizing across the enterprise.\u201d<\/p>\n
Meanwhile, UnitedHealth reported quarterly earnings per share of $2.11, in line with analyst expectations but down roughly 70% from the same quarter in 2024.<\/p>\n
The company also said it took a $799 million hit to full-year revenue due to a major cyberattack in February 2024 on its subsidiary Change Healthcare.<\/p>\n
Investors will get fourth-quarter and full-year results from Elevance Health on Wednesday, Jan. 28, while CVS, Humana, and Cigna Group (CI) are scheduled to report earnings in February.<\/p>\n
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at <\/em>jake.co<\/em>nley@yahooinc.com<\/em>.<\/p>\n
Click here for in-depth analysis of the latest health industry news and events impacting stock prices<\/strong><\/p>\n<\/p><\/div>\n