Health insurers rally after government lays out better-than-expected Medicare Advantage raise
Shares of major health insurers jumped Tuesday after the federal government announced a better-than-expected 2026 payment increase for Medicare Advantage plans.
The Centers for Medicare and Medicaid Services said Monday after markets closed that final rates are expected to increase more than 5% in 2026.
That wound up well above expectations, Leerink Partners analyst Whit Mayo said in a research note.
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Chicago Tribune
2 hours ago
- Chicago Tribune
Terry Savage: AI used to guide seniors to Medicare programs
Does the concept of artificial intelligence intimidate you? Or do you figure it won't have much impact on your life, so why bother learning about it? Well, AI is definitely entering — and improving — your life, whether you choose it or not. When I first wrote about ChatGPT several years ago, AI was viewed as a powerful tool to collect information from huge databases and sort it out to provide answers to questions. Since then, AI has quickly morphed into a useful tool for business and individuals, creating accurate and life-like interactions that make outcomes easier. For example, the new Social Security commissioner, a former tech payments CEO, has announced that Social Security will soon be using AI in its call centers. If the idea of talking to a 'robot' sends chills down your spine, think again. In this column, I'll show you a company that is already using AI in its call center — and generating responses that truly make you think you're talking to a helpful person. A reality check It's a generational thing. When I want help after calling a toll-free number for product information or credit card adjustments or insurance issues, I want to talk to an intelligent human being. I guess there aren't enough to go around! One of my pet peeves is being transferred to a voice messaging system that tries to 'help' me decide how to get answers to a simple question. They offer five choices, none of which is helpful. Representative, please! The only thing worse than a voice-activated decision tree is getting transferred to a live person who just happens to live in a foreign country and who is obviously responding off a script. If I ask to talk to a supervisor, I'm told there is no supervisor available! Don't these companies care about their customers? (Insert your own swear word here!) Artificial intelligence that's real So I must say I was absolutely shocked to hear a demonstration of AI being used by eHealth to start the process of guiding seniors to the appropriate choices for Medicare programs. For many years, eHealth has been a popular health insurance marketplace that helps people find the right insurance coverage by comparison-shopping plans from more than 180 insurers for coverage ranging from Medicare Advantage and supplemental plans to individual and family health policies, along with other benefits such as dental and vision. Many people access eHealth through its website, Others use their toll-free number 1-800-EHEALTH (1-800-343-2584) to reach their licensed and helpful insurance agents. Getting to the agent licensed in your state of residence, and knowledgeable about your specific product request, could take a lot of time during busy days around Medicare enrollment. And what about calls that come in late at night? That's why eHealth created 'Alice' — an AI 'agent' who does not actually sell insurance policies but who asks relevant questions to direct you to the correct licensed agent. You'd swear that you are talking to a live person, since 'her' responses are not only appropriate but friendly. Listening to the demo that eHealth sent me, I was absolutely blown away. I knew that you'd want to hear the same thing, so if you are reading this column online at my website you can click on this link in the article. In this case, an audio demo is worth a thousand words! Even if you're not shopping for health insurance, I recommend listening to this short clip of an interaction between someone calling the toll-free line late at night and the AI agent, Alice. This company has taken AI to the next level. Suddenly, you'll understand how much more helpful an AI agent can be than a call center in the middle of nowhere! And, on a personal level, you'll see how AI has so much potential to change our lives for the better (yes, or for the worse). I spoke with Ketan Babaria, chief digital and AI officer of eHealth. He notes that while AI is not (yet) selling policies, it is making a big difference in their processes: 'Our new AI agents are trained to be patient, caring and sympathetic. As a result, we are making it easier and faster for people to start the shopping process for a Medicare plan, enabling them to more quickly connect with a licensed agent who can help them comparison shop for the right health coverage.' So the next time you hear that your call will be answered by AI, don't hang up in fear, hoping that the next time you'll get a 'real person.' Odds are that soon you'll be connecting with many AI agents. And the odds are even better that you'll get the correct answer from a compassionate robot than you'd get from the overworked and underinformed call center worker. That's The Savage Truth.
Yahoo
7 hours ago
- Yahoo
Is UnitedHealth a Buy for Long-Term Investors?
UnitedHealth is going through a rough patch, underscored by decelerating earnings, management changes, and some bad publicity. Over the last month, its stock price has collapsed and now hovers around a five-year low. Recent commentary from management coupled with a flurry of insider buys suggest the business is still positioned well for the long run. 10 stocks we like better than UnitedHealth Group › With shares down by more than 40%, UnitedHealth Group (NYSE: UNH) is the poorest-performing stock in the Dow Jones Industrial Average so far this year. Over the last month or so, there has been no shortage of storylines surrounding America's largest health insurers. And if the share price movements are any indication, most of the news isn't great. Let's dig into what has driven UnitedHealth stock off a cliff, and explore whether or not it remains a good buy for long-term investors. A significant influence on a stock price, at least over the short term, is how a company's quarterly earnings are perceived. Generally speaking, if a company beats Wall Street estimates or raises its outlook, shares rise. On the other hand, if investors aren't impressed by the company's performance, they may choose to sell the stock. During UnitedHealth's fourth-quarter and full-year 2024 earnings call in January, management issued earnings guidance of $28.15 to $28.65 per share. Things took an unexpected turn when it reported first-quarter earnings on April 17. Management is now guiding in the range of $24.65 to $25.15 for earnings per share (EPS). Two primary factors contributed to the downward revision. First, utilization rates from the company's Medicare Advantage businesses were higher than management was forecasting. These dynamics increase near-term costs, thereby stifling profitability. Second, the company's Optum Health division -- which serves as a pharmacy benefits manager -- has been struggling on reimbursement due to a combination of cuts to Medicare as well as changes in insurance plans in certain market demographics. Unfortunately for investors, UnitedHealth's drama didn't stop at the operational hiccups detailed above. About a month after the first-quarter earnings report, the company announced that CEO Andrew Witty had resigned. If this weren't enough to get investors hitting the panic button, The Wall Street Journal followed up that news with a report that UnitedHealth was under investigation from the Department of Justice (DOJ) regarding fraudulent activity in Medicare billing. Management was quick to deny these claims and called the report "deeply irresponsible." As of this writing (June 3), shares are trading around $300, near a five-year low. The graph above shows that UnitedHealth is valued right in between insurance giants Humana and Cigna on a forward price-to-earnings (P/E) basis. Just a month ago, the company's forward P/E was roughly twice as high as now and trading for a premium compared to the competition. Given the extreme valuation compression over the last several weeks, I am inclined to think much (if not all) of the bad news is priced into the stock already. A downward revision in guidance and changes in management are the main talking points surrounding UnitedHealth at the moment. But in the company's first-quarter earnings release and the the announcement of Witty's resignation, management added that the company should return to growth by next year. The company's new CEO, Stephen Hemsley, purchased $25 million in UnitedHealth stock following the sell-off last month. This was met with another $6.6 million of insider buys from other executives. I think this signals confidence in the company's long-term prospects. In my view, these insider buys suggest management believes that UnitedHealth is poised to return to growth. While the near-term price action might continue exhibiting some volatility, I think the shares remain a solid opportunity for long-term investors. Given the valuation trends explored in this article, I think now is an opportunity to buy the dip in UnitedHealth Group stock at a bargain valuation. Before you buy stock in UnitedHealth Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and UnitedHealth Group wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $868,615!* Now, it's worth noting Stock Advisor's total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 Adam Spatacco has no position in any of the stocks mentioned. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy. Is UnitedHealth a Buy for Long-Term Investors? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14 hours ago
- Yahoo
Virtual Care Firm Omada Health Leverages GLP-1 Trend For $150 Million NASDAQ Debut
Omada Health, Inc. (NASDAQ:OMDA) closed its first day of trading at $23 per share on Friday, a 21% jump from the IPO price of $19 per share. On Thursday, Omada Health priced its initial public offering of 7.9 million at $19/share. The company filed its initial prospectus in May and updated the document with an expected pricing range of $18 to $20 per share. The company raised $150 million in its IPO. Reuters reported Omada Health's valuation hit $1.28 billion. Omada's revenue increased 57% in the first quarter of 2025 to $55 million from $35.1 million a year earlier, according to its prospectus. For 2024, revenue rose 38% to $169.8 million from $122.8 million the previous company's net loss narrowed to $9.4 million in the first quarter from $19 million a year ago. Omada launched its initial virtual program in diabetes prevention and weight health in 2012. The company delivers virtual care between doctor visits, providing an engaging, personalized, and integrated experience for members designed to improve their health while delivering value for employers, health plans, health systems, pharmacy benefit managers (PBMs), and other entities that cover the cost of programs. According to its S-1 filing, the company had 2,000 customers and more than 679,000 members enrolled in one or more programs as of 31 March. Omada says it has supported more than 1 million members since its launch. The company expanded its virtual care programs to target prediabetes, hypertension, and musculoskeletal conditions. The company estimates that about 20 million people have benefits coverage for one or more Omada programs. According to the company's S-1 filing, this represents about 14% of the self-insured insurance market, 9% of the fully insured market, 1% of the Medicare Advantage market, and 1% of the PBM market. Wall Street Journal, citing President Wei-Li Shao, writes that Omada leadership sees the current moment as the perfect time for an IPO, as GLP-1 drugs such as Ozempic, Wegovy, and Mounjaro have sparked a renewed focus on health problems that can stem from obesity. GLP-1s are expected to be a significant tailwind as more employers are rolling out reimbursement plans for the drugs, CEO Sean Duffy told WSJ. Omada, which signs contracts with employers to offer as a benefit to their workers, aims to be a complementary service that helps patients navigate taking GLP-1s. Omada's IPO is the second digital health IPO in weeks following an extended drought for the industry. In May, digital physical therapy startup Hinge Health Inc. (NYSE:HNGE) debuted on the New York Stock Exchange. Hinge Health priced its IPO of 13.7 million shares at $32 per share. Price Action: OMDA stock is trading lower by 0.43% to $22.90 premarket at last check Monday. Read Next:Photo via Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Virtual Care Firm Omada Health Leverages GLP-1 Trend For $150 Million NASDAQ Debut originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
