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Managed-care stocks rose after Democratic presidential hopeful Elizabeth Warren unveiled a proposal to pay for a $20.5 trillion Medicare for All program with taxes on businesses, financial firms, and the wealthy.

“Today, in 2019, in the United States of America, the wealthiest nation in the history of the world, inadequate health coverage is crushing the finances and ruining the lives of tens of millions of American families,” Warren wrote in a lengthy document out Friday morning. “Health care is a human right, and we need a system that reflects our values. That system is Medicare for All.”

Warren is a co-sponsor of the Medicare for All bill in the Senate, which would effectively replace the managed-care industry with a government-run program. Yet she had been reticent to share details of her plan to finance the scheme, drawing criticism from other Democratic presidential contenders.

Shares of managed-health-care stocks have been buffeted this year by worries over Medicare for All, though those fears seem to be moderating. When Bernie Sanders introduced the Medicare for All bill in the Senate in April, the S&P 500 Managed Health Care index dropped 13.5% in a week. Yet the index performed well in October, rising 15.7% while the S&P 500 was up 2.2%.

Warren’s plan would impose no new taxes on the middle class, but would introduce a number of new taxes on businesses and wealthy individuals, including a new 6% tax on the assets of billionaires over $1 billion. That would be in addition to her previously proposed 2% tax on assets of more than $50 million.

Warren also highlighted plans to cut prescription-drug prices, a common theme among both Democrats and Republican candidates. Warren threatened to use “compulsory licensing and public manufacturing” to cut drug prices if other options failed, proposing to allow the government to override drug patents.

“Investors have deemed the Sanders plan to be untenable, at least as laid out in its initial form,” wrote Jared Holz, a health-care strategy trading-desk analyst at Jefferies, in a note Friday morning. “We think the Warren proposal, along with its $52 trillion price tag, will also be met with skepticism to say the least and likely viewed as a non-starter by many. Early feedback suggests this is the case.”

Managed-care stocks were up on Friday morning, as the S&P 500 rose 0.8%. The S&P 500 Managed Health Care index was up 1.4%, as shares of UnitedHealth Group (ticker: UNH) jumped 1.3% and Humana (HUM) was up 1.5%.

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com