Hospital stocks advance as Senate scuttles Graham-Cassidy bill

Hospital stocks advanced Tuesday as the Senate shelved the Graham-Cassidy bill to repeal and replace the Affordable Care Act.

At the closing bell on Tuesday, HCA stock posted a gain of 1.8% while Community Health Systems and Universal Health Services were up 1%.

Tenet Healthcare and LifePoint Health each posted 0.8% increases on the day.

Senate Majority Leader Mitch McConnell scuttled the legislation after GOP Sens. Rand Paul of Kentucky, John McCain of Arizona and Susan Collins of Maine said they would oppose Graham-Cassidy, leaving the bill short of the 50 votes needed for passage.

All 48 Democratic senators were expected to vote against the legislation.

Graham-Cassidy sought to end Medicaid expansion by 2020. The legislation also would have repealed the employer and individual mandates, while doling out nearly $1.2 trillion in ACA subsidies to the states through block grants.

S&P Global Ratings on Monday declared that Graham-Cassidy would result in 580,000 job losses and cause the U.S. economy to decelerate to 2% annually over the next decade.