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 Aetna Inc announced plans to buy smaller rival Humana Inc in early
July and Anthem Inc agreed to buy Cigna Corp later that month. Both
mergers are being reviewed by the U.S. Department of Justice and
state insurance officials.
The American Medical Association study focused on the impact on the
commercial fully insured and self insured markets, largely made up
of employer-based plans. The health insurers also manage plans for
Medicare, Medicaid and other government programs not included in the
study.
The proposed insurance mergers follow the implementation of
President Barack Obama's healthcare overhaul, the Affordable Care
Act, which extended health insurance to millions of people. Insurers
say the combinations will help them better compete as companies as
the government tries to rein in healthcare spending.
Anthem and Cigna combined would affect competition in 13 states
where they sell individual insurance plans and in all 14 states
where Anthem currently operates Blue Cross Blue Shield plans, the
AMA's analysis found.
Anthem spokeswoman Kristin Binns said the two companies have limited
overlap and the merger would help consumers by allowing the merged
company to better manage costs.
An Aetna and Humana merger would raise anti-competitive issues in as
many as 14 states overall including Humana's home state of Kentucky,
Texas, Georgia, Utah and Florida, the study said. The majority of
Humana's business is in Medicare Advantage, which is not part of the
study.
An Aetna spokeswoman noted that Humana's focus is on Medicare. "The
AMA report focuses on competition in the commercial marketplace,
which would not meaningfully change following an Aetna/Humana
combination given Humana’s very small commercial business,"
spokeswoman Cynthia Michener said.
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The American Hospital Association has also made public its analysis
of the two deals, saying they would diminish competition.
The Department of Justice will take a hard look at the study, said
Mark Ryan, of the law firm Mayer Brown and formerly of the
department's Antitrust Division.
"I think they'll pay a lot of attention to what the doctors are
saying because they would be impacted by the merger," Ryan said.
Doctors could well be concerned that they would be paid less because
of the mergers, said Andrew Gavil, who teaches antitrust at Howard
University School of Law. "The AMA could be right but obviously they
are self-interested," Gavil said.
(Reporting by Caroline Humer in New York and Diane Bartz in
Washington; editing by Frances Kerry and Grant McCool)
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