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Arkansas gets Medicaid work approval; ILS options for NFIP reinsurance placement

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Arkansas gets Medicaid work approval; ILS options for NFIP reinsurance placement

Arkansas became the third state in the U.S. to gain a waiver of federal rules that will permit it to require Medicaid beneficiaries who meet certain criteria to work in exchange for receiving health benefits. The state follows Kentucky and Indiana in receiving the so-called Section 1115 waivers from the Centers for Medicare and Medicaid Services, or CMS. But CMS was not prepared to allow Arkansas under the waiver to lower its eligibility criteria for Medicaid from 138% of the federal poverty level to 100%, Gov. Asa Hutchinson acknowledged.

It is time for healthcare providers, insurers, pharmacies and drugmakers to be more transparent about their pricing, Health and Human Services Secretary Alex Azar told a gathering in Washington. And if the private-sector does not make that happen, the U.S. government has "plenty of levers to pull that would help drive this change." With healthcare costs skyrocketing, "the current system simply cannot last," he said. He argued that to achieve a value-based system, the administration must remove some government rules and regulations.

Axa CEO Thomas Buberl faced a barrage of questions from analysts after his company's decision to buy Bermuda-based insurance group XL Group Ltd for $15.3 billion sent shares crashing by 9.7% on March 5. The deal is part of an ongoing consolidation in the property and casualty space, with companies coming under pressure to increase scale through acquisitions, according to a report by The Wall Street Journal. For AXA, the deal offers "radical transformation," according to Paul Davies of the Journal, "but it is paying a big price and taking big risks."

NFP Corp. acquired Ocean City, Md.-based Insurance Management Group Inc. in a transaction that closed Feb. 1.

MBIA Inc. and other bond insurers have settled a 2008 lawsuit filed by the city of Los Angeles claiming violation of California's antitrust laws. The settlement is expected to be finalized in the first half of the year.

The U.S. Federal Emergency Management Agency, or FEMA, is working on a mid-year 2018 reinsurance placement for the National Flood Insurance Program, or NFIP, Artemis reported, citing Roy Wright, NFIP COO and FEMA deputy associate administrator for insurance and mitigation. At an industry conference in Miami, he said FEMA is trying to de-risk the NFIP with the help of private markets and is exploring the use of insurance-linked securities.

Validus Holdings Ltd. unit AlphaCat Managers Ltd. and Terra Brasis Resseguros S.A. have completed a $5 million private catastrophe bond transaction.

Featured news

Bristol-Myers' Opdivo gets price cut in Japan; Azar seeks pricing changes in US: Bristol-Myers Squibb Co.'s cancer drug Opdivo is getting a 23.8% price cut in the Japanese market in April following a series of price reduction rules in the country, Pharma Japan Web reported.

Financial news in other parts of the world

Asia-Pacific: Indian central bank fines 2 lenders; Mega Financial posts FY'17 net income

Europe: UK fines, bans Deutsche Bank ex-trader; Bank of Ireland COO to leave

Middle East & Africa: Boursa Kuwait may launch IPO this year; Tunisia raises key rate

Latin America: Brazil's Banco Original sees ownership rejig; Peru's La Positiva to sell stake

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng rose 2.09% to 30,510.73, while the Nikkei 225 climbed 1.79% to 21,417.76.

In Europe, around midday, the FTSE 100 gained 0.94% to 7,182.87 and the Euronext 100 rose 0.83% to 1,014.58.

On the macro front

The Redbook and the factory orders report are due out today.