After the announcement of Trump’s proposed budget for 2018 was announced Tuesday, HealthCare stocks collectively witnessed a 10% intraday. The Healthcare stocks seemingly held steady earlier in the day; however after the briefing, there was a dip. Trump is requesting that upwards of $800 Billion be cut from Medicaid. As addressed by United States Office of Management and Budget Director, Mick Mulvaney during a briefing of President’s Trump’s FY2018 proposed budget. According to Reuters, Senator Claire McCaskill of Missouri said Trump's plan would devastate rural areas – with the Medicaid cuts directly hitting hospitals and nursing homes – and harm poorer voters who backed Trump at last year's presidential election.
"This is a sea change in terms of how we would look at taking care of the most vulnerable in our country. And frankly it is really going to have a big impact on the parts of my state that were the biggest supporters for Donald Trump," she said.
Molina Healthcare, Inc. (NYSE: MOH) noted a slight drop within a 45 minutes of the FY2018 Budget briefing, Molina Healthcare offers Medicaid solutions to consumers and has three business segments, Health plans, Medicaid solutions and heath/community support for businesses.
Centene Corp. (NYSE: CNC), a healthcare company that provides a portfolio of services to government sponsored healthcare programs, also suffering from the proposed budget news. Since Friday, 5/19/2017, their stocks has dropped from trading at an intraday high of $76.45 to low of $73.13 on Monday, There was a slight uptick on Tuesday morning of $74.65 to a 2.3% decrease after today’s budget release.
The news of the budget cuts are sending ripples through the healthcare sector. Many Republicans are also stating their opposing to the budget, such as Republican Sheila Jackson Lee of Texas as she stated her disagreement on Bloomberg TV.