• Sat. Apr 20th, 2024

Medicare Rate Failure Leaves Health Insurers Struggling to Keep Up with Competition

BySamantha Jones

Apr 2, 2024
Lower Medicare rates impact CVS, Humana, and other health stocks

Medicare regulators failed to increase payments for health insurance companies, including Humana, CVS Health, UnitedHealth, and Elevance Health. This caused stocks of these companies to drop during morning trading on Tuesday. The Centers for Medicare and Medicaid Services announced that government payments to Medicare Advantage and Part D programs would increase by an average of 3.7% or $16 billion year-over-year in 2025. However, the rate increase announced by CMS is the same as a rate proposal made in January, and over the past 10 years, final rates were not increased from their initial proposal only once.

During an investor call in March, Humana’s CFO Susan Diamond expressed disappointment with the rate increase. She stated that it may be challenging for the company to reach its goal of boosting earnings by $6 to $10 without a bigger increase in payments. This news comes as other pharmaceutical companies face challenges such as drug shortages affecting Eli Lily’s ZepboundOzempic and backlash over the low cost of producing the drug.

By Samantha Jones

As a dedicated content writer at newszxcv.com, I bring a passion for storytelling and a keen eye for detail to every piece I create. With a background in journalism and a love for crafting engaging narratives, I strive to deliver informative and captivating content that resonates with our readers. Whether I'm covering breaking news or delving into in-depth features, my goal is to inform, entertain, and inspire through the power of words. Join me on this journey as we explore the ever-evolving world of news together.

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