Major insurance stocks have dropped by more than 6% since their closing prices last Tuesday, the day before the fatal shooting of Brian Thompson, CEO of UnitedHealth Group’s insurance arm, in midtown Manhattan. This decline includes UnitedHealth, CVS Health, and Cigna, which are among the nation’s largest private health insurers. Thompson, aged 50, was the leader of UnitedHealthcare, the largest private provider of health insurance benefits in the U.S.
Luigi Mangione, 26, is accused of shooting Thompson to death outside the Hilton hotel in midtown Manhattan early last Wednesday as the CEO was on his way to UnitedHealth Group’s investor day. Investigators revealed that Mangione was critical of the health-care industry, a sentiment that resonated with some Americans online following Thompson’s death.
The stock performance of these companies seems to be a reaction to the increased criticism of insurers’ business practices. Jared Holz, Mizuho’s health-care equity strategist, mentioned that the industry has long been blamed by many Americans for escalating health-care expenses due to their profit-driven practices.
Holz expressed that investors are reconsidering owning stocks in this sector amidst the renewed negative attention on the industry. UnitedHealthcare and other major insurers have faced legal challenges and public scrutiny for allegedly prioritizing profits over patient care, leading to denied claims, high out-of-pocket costs, and other issues.
Despite the recent backlash, Holz believes that the negative impact on stock prices will likely be short-lived and does not anticipate significant policy changes from insurance companies in response to the shooting incident.
Luigi Mangione, charged with second-degree murder and other offenses, was arrested in Altoona, Pennsylvania, and is being held without bail. He was found with handwritten pages criticizing the U.S. health-care industry, particularly targeting UnitedHealthcare. Authorities are still investigating the motive behind the shooting, which is expected to unfold in the coming weeks and months, with indications of anti-corporatist sentiments and grievances against the health care sector.
