Hedge funds invest in US health insurers despite Amazon, JPMorgan, Berkshire threat

Prominent hedge fund managers like Jana Partners and Omega Advisors increased their stakes in U.S. health insurers during the first quarter of 2018 despite Amazon, JPMorgan Chase and Berkshire Hathaway's imminent foray into the space, Reuters reports.

Here are three things to know about U.S. hedge funds' investing patterns.

1. Several prominent hedge funds increased their investments into a variety of health insurers: Jana Partners increased its stake in Anthem, while Omega Advisors and Tiger Management opened positions in UnitedHealth Group, according to the companies' regulatory filings released May 15 and obtained by Reuters.

2. Shares in the aforementioned insurers tumbled after Amazon, JPMorgan and Berkshire Hathaway announced their intent to form a healthcare company in January to slash their employees' healthcare costs. While the venture has yet to demonstrate impactful progress on the issue, Berkshire Hathaway Chairman and CEO Warren Buffett said leaders expect to select a CEO for the venture within the next few months.

"We want our employees to get better medical services at lower cost. ... The resistance will be unbelievable, and if we fail, at least we tried," Mr. Buffett said during an annual shareholders' meeting earlier this month.

3. Shares of pharmacy benefit managers such as Express Scripts and CVS Health also declined following news of Amazon's potential foray into the drug market. However, not all healthcare executives believe Amazon's entry into the business will be as impactful as some experts suggest. Glenview Capital Management CEO Larry Robbins said during an investment conference April 23 the retail behemoth's entry into the space is "neither imminent, assured, nor likely to succeed," according to Reuters.

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