Dallas-based Tenet Healthcare saw stocks drop nearly 5 percent after President Donald Trump's administration announced Thursday it will no longer reimburse insurers for cost-sharing reductions, CNBC reports.
The cost-sharing reductions help offset the cost of providing health insurance to low-income Americans on the exchanges. The administration will discontinue the payments immediately. Without the subsidies, which were projected to be $9 billion next year, payers will likely hike premiums or leave exchanges in 2019. Some payers already increased premiums for 2018 in anticipation of discontinued subsidies and are locked into providing coverage next year.
Long Beach, Calif.-based Molina Healthcare, which is a large player on the ACA individual exchanges, saw stocks fall more than 4 percent after the announcement.
If consumers drop health insurance due to larger costs, hospitals' uncompensated care costs may climb. After the decision, Community Health Systems and Acadia Healthcare, both based in Franklin, Tenn., saw stocks dip more than 5 percent and 3 percent, respectively. King of Prussia, Pa.-based Universal Health Services saw shares decrease more than 1 percent.