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Docs Ask Florida AG to Block Aetna-Humana Merger

News  |  By John Commins  
   March 15, 2016

The American Medical Association and two Florida medical associations argue that the proposed merger would "eviscerate" physicians' options to contract with other insurers and would raise costs.

State and national medical associations are asking Florida Attorney General Pam Bondi to reject a proposed merger between Aetna and Humana.

In a joint letter to Bondi, the American Medical Association, the Florida Medical Association, and the Florida Osteopathic Medical Association said that the merger would worsen an already anticompetitive environment among the state's largest health insurance providers, "eviscerate" physicians' options to contract with other insurers, and would raises costs and restrict access to care.

In November, the Texas Medical Association requested that the U.S. Department of Justice investigate the proposed merger; by January, 15 state attorneys general had joined the federal probe.

Last month, Florida's Office of Insurance Regulation gave Aetna approval to acquire Humana.

An AMA analysis found that that the proposed Aetna-Humana merger would run afoul of federal antitrust guidelines in highly populated metropolitan areas across the state. Even without the merger, the AMA found Florida's health insurance markets to be highly concentrated, with 19 of the state's metropolitan areas having two health insurers with at least a 50% share of the commercial market.

"Competition, not consolidation, is the right prescription for Florida's health insurance markets," AMA President-elect Andrew W. Gurman, MD, said in remarks accompanying the letter.

"Less competition in Florida's already consolidated health insurance markets will lead to price increases, not to greater efficiency or lower healthcare costs. Given the negative long-term consequences of the proposed merger, any remedy short of rejection would not adequately protect 2.4 million people in Florida." 

On Feb. 15, the Florida Office of Insurance Regulation issued a conditional consent order for the merger that acknowledged a concentrated health insurance market in the state. However, state regulators said many of the anticompetitive concerns raised by the merger could be addressed by regulation.

The physicians' associations strongly disagreed. "The OIR appears to have been captured by Aetna's faulty arguments that existing state and federal regulation… mostly solve the competitive concerns and justify very limited remedies that are largely illusory," AMA CEO President James L. Madara, MD, wrote in the letter to Bondi.

Kristine Grow, a spokeswoman for Hartford, CT-based Aetna, says the insurers believe the merger "will improve the healthcare system and offer consumers more choices and greater access to higher quality, more affordable care."

"Our proposed transaction is primarily about the Medicare marketplace, where there is robust competition and choice. We are confident that our transaction will receive a fair, thorough, and fact-based review from the Department of Justice and the states," Grow says.

"Approximately two-thirds of individuals eligible for Medicare still choose a traditional Medicare plan. Aetna and Humana combined will operate a Medicare business with only 4.4 million Medicare Advantage enrollees, which is only 8% of the 54 million beneficiaries enrolled in the rapidly growing Medicare population."

The deal still has to clear state and federal regulation before the merger can be finalized. Federal scrutiny into the Aetna/Humana deal and into a proposed Anthem/Cigna merger is expected to veer from the agency's previous antitrust investigations.

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.


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