Medicare and Medicaid are two of the primary levers the United States government uses to implement change in the healthcare industry. In an environment of escalating and unsustainable costs, most industry professionals agree CMS policies will continue to change. This thesis asks the question: how do changes (or prospective changes) to Medicare and Medicare affect company valuations? I use event study analysis to assess the market impact of four different events involving Medicaid and Medicare. The results suggest that concentration and exposure to CMS programs are significant factors in value creation and value destruction, and that it is important for business leaders to recognize risk exposures in a changing environment.

Author: Jack Amoroso, Class of 2019
Faculty Advisor: Bradley Staats, UNC Kenan-Flagler Business School