ANOTHER REASON FOR DIVESTMENT FROM HEALTH INSURANCE COMPANIES

Goldman Sachs expects large managed health care companies, like WellPoint, are seeking to broaden exposure to public-sector managed care and revenue growth that it presents. WellPoint bought a Medicaid insurance company, Amerigroup, for $4.5 billion. Wall Street analysts and investors see this deal as a revenue growth opportunity for the companies, reflected by the 3.8% increase in WellPoint’s share price and 38% jump for Amerigroup.

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