Anticipation of This Trump Proposal Is Sending Health Insurance Stocks Higher Monday

• StockStory Top Pick OSCR +1.46%
• MOH +1.01% CNC +3.90%

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Key Takeaways

• President Donald Trump is reportedly preparing to unveil a healthcare proposal that would extend Affordable Care Act subsidies, sending shares of major health insurers higher Monday.

• The plan is expected to include income limits on those who can qualify and provide funding to keep enrollees' costs down, Politico reported.

Shares of several major health insurers surged Monday following reports President Donald Trump could be set to unveil a healthcare proposal that would extend Affordable Care Act subsidies.

Molina Healthcare (MOH) shares were up over 3% in recent trading, while Centene (CNC) jumped 5%, and Oscar Health (OSCR) soared 18%. (Read our daily markets coverage here.)

The plan, which could be unveiled as soon as today, is expected to extend ACA subsidies for about two years and could include new income limits for enrollees, along with minimum premium payments, according to Politico.

Why This News Is Significant

Shares of major health insurers are rising on news that the Trump administration may back a two-year subsidy extension under the ACA. Additional support for premiums and cost-sharing could help stabilize enrollment and reduce volatility in the individual market.

The White House is set to ask Congress to approve funds to reduce cost-sharing, which would lower out-of-pocket expenses for some ACA recipients, Politico reported.

Affordable Care Act insurance plan premiums were a major source of contention in the record government shutdown that ended earlier this month. Democratic lawmakers had blocked funding bills arguing to extend subsidies that lowered ACA plan premiums. The shutdown ended after Congressional Republicans agreed to discuss the premiums after the government reopened.

The White House did not respond to an Investopedia request for comment in time for publication.

Read the original article on Investopedia