NEW YORK (
both recieved downgrades from Stifel Nicolaus Weisel analyst Thomas Carroll.
Carroll cut the two health insurers ratings from "hold" from "buy," on the expectation that they will not trade higher in the upcoming months due to pressure from regulations from the U.S. Department of Health and Human Services.
Under the health care overhaul law insurers have to maintain a medical loss ratio of at least 85 percent. Medical loss ratios are the proportion of premium revenues health insurers spend on health care.
Many health insurers, such as Wellpoint, have said they may have to slash costs in order to meet these requirements, according to published reports. It is not clear at this point if the government will implement a phase in period for the insurers or they will have to meet the requirements immediately.
--Written by Maria Woehr in New York.
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