While it's a longshot to become lawdespite the backing of some contenders for the Democraticpresidential nomination, the proposal has the power to upendcompany stock prices.(Photo: Shutterstock)

(Bloomberg) –Politics can be an ugly business. Health-carepolitics, especially so. Health-care companies that get mixed up inpolitics? That was $28 billion worth of ugly on Tuesday, and thestock market damage continued on Wednesday.

“Presidential primary politics,” said Evercore ISI analystMichael Newshel, are “more in focus than fundamentals.”

The slide began in earnest on Tuesday when UnitedHealth Group Inc. – treated by investorsas a bellwether for the insurance sector — waded into the debateover “Medicare for All,” which would expandgovernment-administered coverage to most of the population andrewrite the businesses of U.S. health insurers, hospitals anddoctors.

While it's a longshot to become law despite the backing of somecontenders for the Democratic presidential nomination, the proposalhas the power to upend company stock prices. Together, the sharesof hospitals and insurers lost $28 billion in market value onTuesday, according to data compiled by Bloomberg.

The Tuesday losses capped the worst five-day stretch since 2011for health insurers, despite UnitedHealth reporting earnings thatbeat analysts' estimates and raising its 2019 forecast.

The slide in hospital and insurance stocks continued Wednesday,wiping out billions of dollars more in market value from some ofthe biggest health companies in the U.S.

UnitedHealth fell 3 percent at 10:30 a.m. in New York. Itscompetitor Anthem Inc. was down 4.8 percent, and Cigna Corp. slid3.1 percent. Hospital chain HCA Healthcare Inc. dropped 2.5percent, and Community Health Systems Inc. lost 7 percent.

For months, health insurers have kept largely out of the frayover the proposal to expand Medicare, the government program thatcovers about 60 million mostly elderly Americans. As UnitedHealth'schief executive officer began to wrap his remarks Tuesday morningduring the company's call with analysts, that changed.

The proposal would be a “wholesale disruption of American healthcare,” and would “surely have a severe impact on the economy andjobs — all without fundamentally increasing access to care,” CEODave Wichmann said on the call.

As a source of coverage, UnitedHealth is almost as large asMedicare itself. It provides health-insurance services to 49.7million people, and last year recorded revenue of $226.2 billion.Along with insurance, it operates physician practices, sellsconsulting and data services, and administers drug benefits. Italso covers millions of people in private-sector versions ofMedicare and Medicaid.

While UnitedHealth had kept a low profile, there are signs itwas already becoming a target before Wichmann's remarksTuesday.

Last week, Senator Bernie Sanders of Vermont, who is contendingfor the Democratic presidential nomination, discussed his support of Medicare for All at Fox Newstown hall in Bethlehem, Pennsylvania, on Monday night. Fox anchorBret Baier asked the audience at the event to raise their hands ifthey had private health insurance from an employer.

“Now of those, how many are willing to transition to what thesenator says, a government-run system?” Baier asked the crowd.There were cheers in the room as people raised their hands, andafterward Sanders posted a clip from the event, tweeting “raiseyour hand if you're sick and tired of your private health insurancecompany.”

Last week, Sanders specifically called out UnitedHealth, sayingin an April 12 tweet “your greed is going to end.”

Sanders specifically referenced Steve Nelson, who is chiefexecutive of UnitedHealthcare, the company's insurance division.Sanders cited a Washington Post story about remarks Nelson made ata company meeting.

According to the Post, Nelson answered a question from anemployee about the insurer's role in the political discussion,saying, “the last thing you want to do is become the poster childduring the presidential campaign.”

A spokesman for the company said UnitedHealth has long supportedthe expansion of health-care coverage.

READ MORE:

Risk exposure: Does your plan still offer companystock as an investment option? 

3 takeaways on trends in advisorinvesting

2019 stock market outlook: slower growth but norecession

Copyright 2019 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.