Shares of WellPoint Inc. partially recovered Friday morning after a plunge was touched off Thursday by gathering momentum behind health care reform and talk of a windfall-profit tax by Speaker of the House Nancy Pelosi.
Stock in the Indianapolis-based health insurer was trading above $46 a share this morning, up 3 percent. On Thursday, the shares lost more than 6 percent of their value.
Health insurance stocks opened Friday lower because the Congressional Budget Office declared that a Senate version of a health reform bill would help reduce the deficit and would spend less than the $900 billion limit set by President Obama. The report was interpreted as making health reform more likely to pass.
Wall Street analysts are mixed about whether health reform will be a boon or a burden for health insurers. On one hand, bills in Congress would pump more than $450 billion in new subsidies into the industry over the next 10 years in an attempt to reduce the number of uninsured. On the other hand, the bills would place significantly greater regulations on health insurers and hit up the industry for $67 billion in fees over the next decade.
Thursday's sell-off really got going after Pelosi floated the windfall-profits tax at a mid-morning press conference.
“Maybe that’s something we can put in the mix,” the California Democrat said, according to Bloomberg News. While calling the idea “very preliminary,” she said insurers, drugmakers and other health-care industries have “much more they can put on the table to bring down the cost.”