UnitedHealth Group's stock declined 2.4% amid broader healthcare sector pressures. The company forecasted its first revenue decline in nearly four decades for 2026, following the U.S. Medicare agency's announcement that payment rates for Medicare Advantage plans would increase by just 0.09% in 2027, far below Wall Street expectations of up to 6%. This near-flat payment rate triggered significant declines across health insurers. UnitedHealth's UnitedHealthcare insurance unit indicated the company would need to implement meaningful benefit reductions and reassess its geographic and product footprint in response. The company previously missed earnings estimates for the first time since 2008, dealing with a cyberattack, unexpected increases in medical fees and use, and other operational challenges. Competitors Humana and CVS are scaling back their Medicare Advantage plans for 2025, potentially creating opportunities for other insurers.
Read full analysisUnitedHealth Group's stock declined 2.4% amid broader healthcare sector pressures. The company forecasted its first revenue decline in nearly four decades for 2026, following the U.S. Medicare agency's announcement that payment rates for Medicare Advantage plans would increase by just 0.09% in 2027, far below Wall Street expectations of up to 6%. This near-flat payment rate triggered significant declines across health insurers. UnitedHealth's UnitedHealthcare insurance unit indicated the company would need to implement meaningful benefit reductions and reassess its geographic and product footprint in response. The company previously missed earnings estimates for the first time since 2008, dealing with a cyberattack, unexpected increases in medical fees and use, and other operational challenges. Competitors Humana and CVS are scaling back their Medicare Advantage plans for 2025, potentially creating opportunities for other insurers.
UnitedHealth Group is the largest U.S. health insurer by revenue, operating both an insurance arm (UnitedHealthcare serving 49.8 million consumers) and a healthcare services division (Optum serving over 123 million consumers). The company is navigating a turbulent stretch that includes CEO conflict-of-interest revelations, federal probes into Medicare billing practices, projected loss of over 1.3 million Medicare Advantage members in 2026, and proposed flat 2027 MA payment rates — headwinds that have kept the stock well below analyst consensus targets and driven persistent volatility since its January earnings report.