CNBC’s Jim Cramer expressed his concerns about the healthcare sector after Centene’s stock plummeted due to unexpected full-year guidance withdrawal. He believes the entire managed care industry is “borderline un-investable” right now, with the sector facing significant challenges.
Centene provides healthcare exchanges for government programs like Medicaid and Medicare. The company withdrew its earnings guidance, citing data showing lower-than-expected market growth in 22 of the 29 states it serves. This led to a sharp decline in shares, which hit a new 52-week low and dropped over 40% by close.
Cramer attributes this decline to increased costs for policyholders’ healthcare expenses. He suggests that Centene’s results indicate attrition in healthcare exchange enrollment, with those still enrolled being less healthy than those who left. If premiums rise to account for the economic environment, fewer people will enroll in healthcare programs, except for those with serious illnesses.
Cramer also expressed concerns about President Trump’s “big beautiful bill,” which would substantially shrink Centene’s customer base and leave millions without health insurance. The Senate passed a version of the bill on Tuesday, restricting fees that help fund Medicaid.
Source: https://www.cnbc.com/2025/07/02/jim-cramer-gives-his-take-on-centenes-slide.html