Video: What the GOP's $1 trillion Medicaid cuts could mean for healthcare
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Business Insider
an hour ago
- Business Insider
These 3 Catalysts Could Push UnitedHealth Stock (UNH) Higher
UnitedHealth Group (UNH), one of the largest health insurance and services companies in the U.S., has had a tough year so far. But there are three key catalysts that could help the stock bounce back in the next year or two. These include better-than-expected Medicare Advantage payments, a leadership change at its Optum Health division, and a more stable political environment around healthcare policy. Each of these developments could help UnitedHealth recover from recent setbacks and regain investor confidence. Don't Miss TipRanks' Half-Year Sale Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. The first big catalyst is the improved Medicare Advantage (MA) payment outlook. Earlier this year, U.S. regulators announced a 5.06% rate increase for MA plans in 2026, which was much higher than the 2.23% previously expected. This is important because UnitedHealth relies heavily on MA plans for revenue, through both its insurance business and its Optum services. As a result, higher rates should ease pressure on earnings, especially after a tough 2025 that has been marked by increased medical costs and regulatory investigations. Simply put, more funding means more breathing room for UnitedHealth's bottom line. The second catalyst is a leadership shakeup at Optum Health. After struggling with lower patient volumes and billing issues, UnitedHealth named Patrick Conway, an experienced healthcare executive, as CEO of Optum Health. The hope is that new leadership will help stabilize the business and boost performance. Finally, the third positive factor is reduced regulatory risk. A proposed 25% funding cut to Medicaid and ACA programs was blocked in the U.S. Senate, which helps remove uncertainty for companies like UnitedHealth. When you put it all together—better funding, stronger leadership, and fewer policy threats—UnitedHealth looks better positioned for a recovery. What Is the Future of UNH Stock? Turning to Wall Street, analysts seem to agree that the stock can recover since they have a Moderate Buy consensus rating on UNH stock based on 18 Buys, seven Holds, and one Sell assigned in the past three months. Furthermore, the average UNH price target of $361.91 per share implies 17.2% upside potential.
Newsweek
9 hours ago
- Newsweek
How Trump's Big, Beautiful Bill Impacts Medicaid Users: Experts Weigh In
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Billions in Medicaid cuts passed by Republicans as part of President Trump's "One Big Beautiful Bill" will have widespread negative implications on people across the United States, multiple experts told Newsweek. Why It Matters Trump's touted tax overhaul and spending cuts package, which passed Thursday on a 218-214 vote in the House after months of haggling in both chambers of Congress, has provoked broader concerns about health care access and funding—notably to vulnerable populations who rely on Medicaid and the social safety net. The CBO estimates the roughly $1 trillion in Medicaid cuts over the next decade will result in 12 million people losing coverage by 2034. Trump had repeatedly promised not to cut Medicaid benefits, including by the White House's own admission as recently as March. The cuts are deeply unpopular, according to polls, and present a political challenge for Republicans ahead of next year's midterm elections. What Is the Big, Beautiful Bill? The One Big Beautiful Bill Act is a sweeping reconciliation package that advances Trump's domestic policy agenda. It includes major tax reforms, spending cuts, and regulatory changes across multiple sectors. The bill passed the House and Senate along party lines and is positioned as a cornerstone of Trump's second-term legislative goals. Numerous experts predict that Medicaid cuts and new requirements in President Trump's "One Big Beautiful Bill" will have widespread implications on Americans and state, federal funding mechanisms. Numerous experts predict that Medicaid cuts and new requirements in President Trump's "One Big Beautiful Bill" will have widespread implications on Americans and state, federal funding mechanisms. Photo-illustration by Newsweek/Getty/Canva The 1,200‑page package will: Permanently extend the 2017 Trump tax cuts, while exempting overtime pay, tips and some Social Security income from taxation. Impose 80‑hour‑per‑month work requirements on many adults receiving Medicaid and apply existing SNAP work rules to additional beneficiaries. Repeal most clean‑energy tax credits created under President Biden. Authorize a $40 billion border security surge and fund a nationwide deportation initiative. Raise the federal debt ceiling by $5 trillion, with the Congressional Budget Office estimating that it could add $3.4 trillion to the deficit over the next 10 years. When Did the Big, Beautiful Bill Pass the Senate? The bill narrowly passed the Senate on Tuesday after an overnight session. The 50-50 vote generally along partisan lines was tipped in Republicans' favor by Vice President JD Vance, who cast the decisive tiebreaker vote. Has the Big, Beautiful Bill Been Signed? President Trump signed his package of tax breaks and spending cuts into law Friday during a White House ceremony. How the Big, Beautiful Bill Will Impact Medicaid Beneficiaries The bill includes changes to eligibility for Medicaid, including mandating that Medicaid recipients must carry out some kind of work for at least 80 hours a month, which has prompted many health care experts and lawmakers to warn that it will only push millions off the program. Other concerns include diminished care in rural communities and increased out-of-pocket costs for doctors' visits. To accommodate the bill's signature tax cuts, which mostly benefit the wealthy, the cuts have to come from somewhere, according to Miranda Yaver, assistant professor of health policy and management at the University of Pittsburgh. Consistent with prior Republican approaches, the cuts are coming from America's safety net programs, she said. "One in five Americans relies on Medicaid for their health coverage, and one in seven Americans relies on SNAP for their food security, so cutting these critical programs will be devastating," Yaver said. Roughly 92 percent of Medicaid beneficiaries are already working or would be exempt, according to KFF. But what threatens their coverage is not noncompliance with work hours; rather, the administrative burdens of documenting their work or exemption, according to Yaver. "For that reason, the requirement can be better characterized not as a work requirement, but rather as a paperwork requirement. ... Some have characterized Medicaid paperwork requirements as a solution in search of a problem, because contrary to some characterizations of people playing video games in basements, most people on Medicaid are working or would be exempt," she said. A Medicaid accepted here sign in Kokomo, Indiana, in September 2019. A Medicaid accepted here sign in Kokomo, Indiana, in September 2019. GETTY "I don't think it's a solution in search of a problem so much as it is a solution to a different problem: low-income Americans being provided health insurance." Jake Haselswerdt, associate professor at the Truman School of Government & Public Affairs at the University of Missouri, agreed that the paperwork aspect is likely going to be an issue. "We're going to have to see, what are the regulations look like? How do states implement this?" Haselswerdt told Newsweek. "But I'm not optimistic, especially coming from a Missouri standpoint. "We have maybe the worst Medicaid agency in the country. The call center wait times at times have been the worst in the country." Chris Howard, professor of government and public policy at William & Mary, told Newsweek that cuts to Medicaid and to the Affordable Care Act [ACA] will have "profound effects" at the state level. Millions of people across the country will lose health insurance, he said, including an estimated 300,000 in his state of Virginia. "Basically, Republicans are trying to undermine big parts of the [Affordable Care Act, or Obamacare] without having to replace them," Howard said. "They learned that 'repeal and replace' did not work in Trump's first term, so now they just want to repeal." Large rural populations in some of the hardest hit states, like Virginia and Kentucky which have expanded Medicaid under the ACA, will receive reduced federal funding for individuals who rely on Medicaid. "States can't run budget deficits, and they are highly unlikely to replace all the lost funds," Howard said. "More people will lose coverage. In the health care system, every dollar of benefit to someone is also a dollar of income to someone else. "Hospitals and nursing homes, especially in rural areas, depend heavily on Medicaid dollars. Many of them will have to lay off workers or close down. If hospitals have to provide more uncompensated care to the uninsured, there will be pressure on private insurance to raise rates." Rural hospital closures not only increase driving distances for medical care, Yaver said, but they can also deter businesses from operating in communities with economic downturn. She called the rural hospital fund in the bill "a drop in the bucket relative to the devastation headed their way." Haselswerdt said the ramifications on Americans' health and well-being will also take a hit. The rural hospital fund, around $25 billion, won't be enough across all 50 states, he said. "Nothing's permanent because policy can change, but we think of them as permanent cuts—this kind of short-term, financial Band-Aid," Haselswerdt said. "I don't really think makes that much of a difference. [When] people lose coverage that means these hospitals are delivering more freer charity care that never gets paid for. "That was something that was demonstrated with the ACA. When coverage expanded under the ACA, it helped hospitals; they had less uncompensated care to deal with. So, if you change policy in such a way that more people are showing up at hospitals without health coverage, it's not going to be good for those hospitals." President Donald Trump, from left, speaks as Health and Human Services Secretary Robert F. Kennedy Jr. and Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, listen during an event in the... President Donald Trump, from left, speaks as Health and Human Services Secretary Robert F. Kennedy Jr. and Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, listen during an event in the Roosevelt Room at the White House, Monday, May 12, 2025, in Washington. More Associated Press What the White House Has Said About Impact on Medicaid A "Myth vs. Fact" sheet released by the White House on June 29 responds to numerous critiques of the One Big Beautiful Bill, including on Medicaid. The White House called it a "myth" that the legislation "kicks American families off Medicaid." "As the President has said numerous times, there will be no cuts to Medicaid," the statement reads. "The One Big Beautiful Bill protects and strengthens Medicaid for those who rely on it—pregnant women, children, seniors, people with disabilities, and low-income families—while eliminating waste, fraud, and abuse. "The One Big Beautiful Bill removes illegal aliens, enforces work requirements, and protects Medicaid for the truly vulnerable."
Los Angeles Times
11 hours ago
- Los Angeles Times
Rural hospitals brace for financial hits or even closure under Republicans' $1 trillion Medicaid cut
OMAHA, Neb. — Tyler Sherman, a nurse at a rural Nebraska hospital, is used to the area's aging farmers delaying care until they end up in his emergency room. Now, with the Trump administration planning around $1 trillion in Medicaid cuts over 10 years, he fears those farmers and the more than 3,000 residents of Webster County could lose not just the ER, but also the clinic and nursing home tied to the hospital. 'Our budget is pretty heavily reliant on the Medicaid reimbursement, so if we do see a cut of that, it'll be difficult to keep the doors open,' said Sherman, who works at Webster County Community Hospital in the small Nebraska town of Red Cloud just north of the Kansas border. If those facilities close, many locals would see their five-minute trip to Webster County hospital turn into a nearly hour-long ride to the nearest hospital offering the same services. 'That's a long way for an emergency,' Sherman said. 'Some won't make it.' States and rural health advocacy groups warn that cutting Medicaid — a program serving millions of low-income and disabled Americans — would hit already fragile rural hospitals hard and could force hundreds to close, stranding some people in remote areas without nearby emergency care. More than 300 hospitals could be at risk for closure under the 'Big Beautiful Bill Act,' according to an analysis by the Cecil G. Sheps Center at the University of North Carolina at Chapel Hill, which tracks rural hospital closures. Even as Congress haggled over the controversial bill, a health clinic in the southwest Nebraska town of Curtis announced Wednesday it would close in the coming months, in part blaming the anticipated Medicaid cuts. Bruce Shay of Pomfret, Conn., fears he and his wife could be among those left in the lurch. At 70, they're both in good health, he said. But that likely means that if either needs to go to a hospital, 'it's going to be an emergency.' Day Kimball Hospital is nearby in Putnam, but it has faced recent financial challenges. Day Kimball's CEO R. Kyle Kramer acknowledged that the bill passed Thursday — estimated to cut federal Medicaid spending in rural areas by $155 billion over 10 years — would further hurt his facility's bottom line. Roughly 30% of Day Kimball's current patients receive Medicaid benefits, a figure that's even higher for specific, critical services like obstetrics and behavioral health. 'An emergency means I'm 45 minutes to an hour away from the nearest hospital, and that's a problem,' Shay said. And he and his wife wouldn't be the only ones having to make that trip. 'You've got, I'm sure, thousands of people who rely on Day Kimball Hospital. If it closed, thousands of people would have to go to another hospital,' he said. 'That's a huge load to suddenly impose on a hospital system that's probably already stretched thin.' Rural hospitals have long operated on the financial edge, especially in recent years as Medicaid payments have continuously fallen below the actual cost to provide healthcare. More than 20% of Americans live in rural areas, where Medicaid covers 1 in 4 adults, according to the nonprofit KFF, which studies healthcare issues. President Trump's $4.5-trillion tax breaks and spending cuts plan would worsen rural hospitals' struggles by cutting a key federal program that helps states fund Medicaid payments to healthcare providers. To help offset the lost tax revenue, the package includes $1.2 trillion in cuts to Medicaid and other social safety net programs — cuts they insist only root out fraud and waste in the system. But public outcry over Medicaid cuts led Republicans to include a provision that will provide $10 billion annually to buttress rural hospitals over the next five years, or $50 billion in total. Many rural hospital advocates are wary that it won't be enough to cover the shortfall. Carrie Cochran-McClain, chief policy officer with the National Rural Health Assn., said rural hospitals already struggle to break even, citing a recent American Hospital Assn. report that found that hospitals in 2023 got nearly $28 billion less from Medicaid than the actual cost of treating Medicaid patients. 'We see rural hospitals throughout the country really operating on either negative or very small operating margins,' Cochran-McClain said. 'Meaning that any amount of cut to a payer — especially a payer like Medicaid that makes up a significant portion of rural provider funding — is going to be consequential to the rural hospitals' ability to provide certain services or maybe even keep their doors open at the end of the day.' A KFF report shows 36 states losing $1 billion or more over 10 years in Medicaid funding for rural areas under the Republican bill, even with the $50 billion rural fund. No state stands to lose more than Kentucky. The report estimates the Bluegrass State would lose a whopping $12.3 billion — nearly $5 billion more than the next state on the list. That's because the bill ends Kentucky's unique Medicaid reimbursement system and reduces it to Medicare reimbursement levels. Kentucky currently has one of the lowest Medicare reimbursement rates in the country. It also has one of the highest poverty rates, leading to a third of its population being covered by Medicaid. Kentucky Gov. Andy Beshear, a two-term Democrat widely seen as a potential candidate for president in 2028, said the bill would close 35 hospitals in his state and pull healthcare coverage for 200,000 residents. 'Half of Kentucky's kids are covered under Medicaid. They lose their coverage and you are scrambling over that next prescription,' Beshear said during an appearance on MSNBC. 'This is going to impact the life of every single American negatively. It is going to hammer our economy.' Beck and Haigh write for the Associated Press. Haigh reported from Hartford, Conn.
