Maximus contract with CMS for Medicare services cancelled; shares drop

Maximus (NYSE:MMS ), a prominent provider of government services, reported a significant development as the U.S. Department of Health and Human Services, Centers for Medicare and Medicaid Services (CMS) has cancelled the Contact Center Operations (CCO) 1-800-MEDICARE and Federal Marketplace solicitation.

This solicitation was intended for services that Maximus is currently contracted to provide, with option periods extending up to 2031.

Following the announcement, trading of Maximus shares was temporarily halted. When trading resumed in afterhours, the company's stock experienced an 8% decline.

Bruce Caswell, President and CEO of Maximus, acknowledged the cancellation, highlighting the company's track record in managing the program.

Caswell said, "Maximus employees have consistently demonstrated their ability to successfully manage this critical program providing essential support to more than 75 million eligible Americans who rely on Medicare and the Federal Marketplace. We appreciate the opportunity to continue supporting HHS and CMS in their vital missions and look forward to delivering innovative, high-quality, and reliable solutions that benefit the American public.”

The cancelled solicitation corresponds to the work that Maximus has been performing, indicating a shift in the CMS's approach to managing the contact center operations for Medicare and the Federal Marketplace. The impact of this cancellation on Maximus's operations and future government contracts remains to be seen.

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Source: Investing.com