The Hill: Grassley probes early intel on Medicare Advantage shift

By Elise Viebeck – 04/04/13 06:44 PM ET

Sen. Chuck Grassley (R-Iowa) is asking how a political intelligence firm learned about a major shift in Medicare policy before it was announced by the Obama administration. 

Grassley wrote to Medicare chief Marilyn Tavenner on Thursday seeking to find out who knew, and when, that the administration would scrap its proposed cut to Medicare Advantage (MA). 

Political intelligence firm Height Securities correctly predicted the decision before it was announced. The cut had been fiercely opposed by the insurance industry, and the unofficial news caused a stir on Wall Street that benefited insurance stocks.

“After Height Securities’ prediction was issued, volumes for affected companies jumped to a total of $662.8 million in the final minutes of trading and stocks rose as much as six percent,” Grassley wrote on Thursday.  

“This raises questions regarding political intelligence brokers’ ability to gather information from [the Medicare agency] in order to predict market moving events.”

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