Regulatory filing by Hospital & Medical Service Plans citing a New England Journal of Medicine paper — Molina Healthcare, 2016-01-11
Molina HealthcareMolina HealthcareNYSE MOH
Filings SEC · Quote Yahoo cited a paper published in the New England Journal of Medicine as the basis for its claims in a regulatory filing with the U.S. Securities and Exchange CommissionU.S. Securities and Exchange Commission
Regulator · Website. The company read the way the paper was written and the scope it actually demonstrated in order. It noted where the stock price movement over the following month compared to past cases of the same type. This is a hindsight judgment written after knowing the results. The paper was read only up to the abstract.
The disclosure is written in the press release as follows:
When a U.S.-listed company has something to inform shareholders, it submits a 8-K to the Securities and Exchange Commission. The item number of the document submitted by Molina Healthcare on 2016-01-11 was 7.01 Reg FD disclosure · 9.01 financial statements · exhibits. The company cited a paper published in New England Journal of Medicine in the attached press release. Translating the sentence in the original document that references the paper verbatim, it reads as follows:
New England Journal of Medicine: Accountable Health Communities “ Addressing Social Needs through Medicare and Medicaid; Dawn E. Alley, Ph.D., Chisara N.
What the reader should first check is where the company placed the paper in the press release. Next, they should determine whether the paper supports the entire company claim or only part of it. To answer the latter question, one must read the full paper. This article, which has only read the abstract, cannot provide an answer.
The scope of the paper mentioned in the abstract is limited to this.
The paper's title is Accountable Health Communities — Addressing Social Needs through Medicare and Medicaid and it was published in New England Journal of Medicine on 2016-01-05. The authors are affiliated with the Centers for Medicare and Medicaid Services. The summary at the beginning of the paper is called abstract. This article has read only up to this point. This paragraph was written by a person after filtering out a draft written by a machine by comparing numbers, and thus it is of a different quality than a full reading of the paper.
This article is not a research paper but a short policy introduction published in the medical journal NEJM. It announces a payment model that the U.S. Centers for Medicare and Medicaid have been testing for five years with 200,000,000 dollars. It aims to conduct a large-scale trial on how to address upstream factors such as housing and food within the healthcare delivery system. It is an announcement of the start, not a report on the results.
What the abstract does not answer remains in the full text and appendices. This article, which has not gone beyond the abstract, leaves the gaps as they are. Readers should compare the two citations above to determine which sentence in the abstract corresponds to the excerpt cited by the company.
One month later, the stock price was within the middle half of the sample.
The remaining return after subtracting the portion that moves with the overall market is called excess return. The date is written as trading day, counting only the days the stock market is open. In terms of the calendar, 20 trading days are approximately one month. The excess return for the day of the regulatory filing and the following month are listed in the table below.
| Period | Excess return relative to the market | Meaning |
|---|---|---|
| Five trading days before the filing | −0.3% | The extent of movement before the filing |
| On the day of the filing | +0.9% | On the filing day or the first trading day thereafter |
| Accumulated over +1 to +5 trading days | +3.0% | One week |
| Cumulative +1~+20 trading days | −1.7% | One month |
A bundle of past cases of the same type is called a sample. The position counted from the bottom is expressed as a percentile. The one-month excess return of −1.7% in this case is within the bottom 60% of the 142 cases in the sample, and is within the lower half.
| Sample scale (20 trading days) | Tenth from the bottom | Fourth from the bottom | median | top 25% | top 10% | This case |
|---|---|---|---|---|---|---|
| Excess return | −31.9% | −20.1% | −7.4% | +5.5% | +19.5% | −1.7% |
Half of the sample falls between the two central marks in the chart. One checks from the chart whether this case is inside or outside. The sample collects cases where U.S. listed companies wrote papers in 8-K over the past ten years. The company itself is excluded from the sample. The numbers written here are past facts, not rules to apply to the next case.
There is one more case where the same company wrote a paper in 8-K, so it is placed together in the table below.
| Disclosure date | the journal of the paper | one month excess return |
|---|---|---|
| 2016-02-11 | New England Journal of Medicine | +3.2% |
after the regulatory filing, the company issued such documents
after the filing date, the company issued three 8-K filings. Only the item numbers are listed here. In 8-K filings without titles, the item numbers indicate the type of content. Whether it was an earnings announcement or a contract can be identified by the number. The details of what happened are read in the original text of each link.
- 2017-05-02 8-K Items 5.02, 7.01, 9.01 — Officer/Director changes · Reg FD disclosure · Financial statements and exhibits
- 2017-05-02 8-K Item 2.02,9.01 — Earnings announcement · Financial statements · Exhibits
- 2017-05-15 8-K Item 5.02,5.07,9.01 — Officer and director changes · Shareholder meeting results · Financial statements · Exhibits
What this article does not answer
This article, which reads only abstracts, cannot answer what the paper reviewed, how it was done, or how far it went. How many times the paper cited by the company was cited afterward can be checked again using the OpenAlexOpenAlex
Data source · Website citation count. What will be seen next is whether the company's next 8-K again cites the same paper.
Term explanation
- 8-K
- A periodic report submitted to the Securities and Exchange Commission by a U.S.-listed company when it has news to inform shareholders. The types are indicated by item numbers such as earnings, contracts, and executive changes. All events in this article are derived from this document.
- Excess return
- The remainder obtained by subtracting the overall market return from the stock return. It is used to observe the movement of this company alone, excluding the portion influenced by the overall market fluctuation.
- Trading day
- A date counted only on days when the stock market is open. Since weekends and holidays are excluded, 20 trading days correspond to approximately one calendar month.
- Sample and percentile
- A bundle of past cases of the same type is a sample, and the position from the bottom within it is expressed as a percentile. A percentile of 10 means that nine out of ten cases performed better than this case.
- Abstract
- A summary placed at the beginning of a paper. The author writes in a few sentences what was done, how it was done, and what results were obtained. Without reading the full text, one cannot know the details and limitations of the method.