Follow the debate with a “waryeye,” Veda's Perlman cautioned investors. “Health-care lawmaking isdifficult and change occurs infrequently. This is not a bug in theAmerican political system, it is its design.” (Photo:Shutterstock)

(Bloomberg) –As presidential hopeful Sen. Bernie Sanders (I-Vt.)grabs headlines with his plan for “Medicare for All” and targets doing away withprivate health insurance, equity analysts have been workingovertime to tell investors what companies have the most tolose.

Health insurers and now hospitals have led thesector-wide plunge even as policy analysts like Veda's SpencerPerlman argue that Medicare for All has a slim shot at becominglaw.

With the plan moving 10 percent of GDP to public control fromprivate hands, “it is unprecedented in scale and scope – nothing ofthis magnitude has ever been attempted, let alone succeeded,”Perlman argues.

That hasn't stopped the free-fall in insurers, which has peeled off billions ofdollars from their market-cap in the worst rout in more than twentyyears. “There may be more pain to come but the worst of it may bebehind us (let's hope),” Evercore ISI equity analyst Ross Mukentold clients in a note. While managed care may be near the end ofits retreat, analysis implies “extremes are plausible.”

While the broader healthcare sector remains under pressure —S&P 500 health care names have lost more than 6 percent overthe past three days in their biggest drop since December — managedcare's sell-off appears to have abated for now with S&P 500insurer names now little changed within one day.

Drugmakers, dental stocks and life science tool makers look themost vulnerable, in Muken's view.

For Citi analyst Andrew Baum the pervasive fear that theskyrocketing price of prescription medicines will be brought undertighter rein in a Medicare for All scenario has created anopportunity for long-term pharmaceutical investors.

Baum recommends buying AstraZeneca, Sanofi, Novartis, Bayer aswell as Merck & Co.

Some drugmakers are at greater risk than others andunderperformance in the sector is likely to persist, Wells Fargo'sDavid Maris told clients in a note.

Deeply indebted companies or those with medicines that areheavily used by Medicare recipients or subject to rebating — likeBausch Health — may be most exposed. Smaller generic companies orthose with cash pay products should be better insulated from sectorconcerns although so far “that has not been the case,” henoted.

Device-makers have also been dragged into the fray althoughlater than other health-care sectors.

While the prospect of a single-payer system remains remote, itwould be especially damaging to medical technology companies byeroding structural incentives for surgical interventions, BofAMLanalyst Bob Hopkins wrote.

These are the companies with sales most at risk, according toBofAML:

• Likely less than 50 percent of sales paid in cash: Stryker,Intuitive Surgical
• Companies with roughly half of their sales exposed: Medtronic,Zimmer Biomet, Becton Dickinson, Edwards Lifesciences, BostonScientific
• Least exposed: the recent Novartis spinoff Alcon, Abbott Labsand Baxter

“The U.S. is likely to gradually move away from our current feefor service, employment-based system to some sort of hybrid systemthat resembles certain systems in Europe,but in our view this willtake a decade or more,” Hopkins said.

Follow the debate with a “wary eye,” Veda's Perlman cautionedinvestors. “Health-care lawmaking is difficult and change occursinfrequently. This is not a bug in the American political system,it is its design.”

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