NEW YORK (TheStreet) -- Shares of DaVita Healthcare (DVA - Get Report) were falling mid-Friday morning after the Centers for Medicare and Medicaid Services (CMS) issued a request for public comment on concerns that healthcare providers are allegedly illegally steering patients.
DaVita, based in Denver, is a provider of kidney care services.
According to a CMS statement, some healthcare providers like DaVita may be steering people receiving Medicare and Medicaid benefits into certain Marketplace plans to obtain higher reimbursement rates.
The group also sent letters to all Medicare-enrolled dialysis facilities and centers to inform them of the announcement.
Following the release of letter, analysts at JPMorgan lowered their price target on DaVita stock to $65 from $75 while maintaining a "neutral" rating, according to a note cited by the Fly.
The firm said that exchange health plans may reject the majority of American Kidney Fund dialysis third party premium assistant payments in the fall. This threatens at least 1% of DaVita's patient mix.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "hold" with a ratings score of C+.
The company's strengths can be seen in multiple areas, such as its revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.
You can view the full analysis from the report here: DVA