Shares of health insurers slumped on Thursday as analysts said a report issued on a key U.S. Senate healthcare reform bill should give the legislation a boost.
Nonpartisan budget analysts said late on Wednesday that a Senate Finance Committee health plan would cost $829 billion and cut the budget deficit by $81 billion over 10 years. The bill would meet President Barack Obama's desire for a healthcare plan that does not increase the deficit, according to the Congressional Budget Office.
Shares of WellPoint Inc
The successful CBO score increases the likelihood that a reform bill will pass and it also strengthens the (Senate Finance Committee) bill's position as the bill that will drive the debate, Wells Fargo analyst Matt Perry said in a research note.
The share moves continued the declines since mid-September for health insurance stocks, which have proved extremely sensitive to reform developments in Washington.
We continue to think managed care stocks will remain in flux until the 'devils in the detail' are resolved in final legislation, Goldman Sachs analyst Matthew Borsch said in a research note.
(Reporting by Lewis Krauskopf, editing by Dave Zimmerman)