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New analyses support blocking Anthem-Cigna and Aetna-Humana mergers

Two new American Medical Association analyses support the blocking of the Anthem-Cigna and Aetna-Humana mergers.

“The [American Medical Association] AMA analyses show that Anthem-Cigna and Aetna-Humana mergers would significantly compromise market competition in the health insurance industry and threaten health care access, quality and affordability,” Andrew W. Gurman, MD, president of the AMA, said in a press release. “With existing competition in health insurance markets already at alarmingly low levels, federal and state antitrust officials have powerful reasons to block harmful mergers and foster a more competitive marketplace that will operate in patients’ best interests.”

In July, the U.S. Department of Justice began working with several state attorneys general to block the merger deals.

According to the new analyses, the two mergers would have significantly reduced competition across 24 states. The Anthem-Cigna merger would reduce competition in 121 metropolitan areas across the 14 states where Anthem is licensed to provide coverage, including California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia and Wisconsin. Nine of these states are working to block the merger, while Indiana, Kentucky Nevada, Ohio and Wisconsin have yet to take action.

The Aetna-Humana merger would reduce competition in 57 metropolitan areas across 15 states, including Arizona, Florida, Georgia, Illinois, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Ohio, Tennessee, Texas, Utah, West Virginia, and Wisconsin. Florida, Georgia, Illinois, and Ohio are working to block the merger, while the remaining states have yet to take action.

A newly released edition of AMA’s Competition in Health Insurance: A Comprehensive Study of U.S. Markets describes the picture of health insurance competition across 388 cities, as well as all 50 states. The researchers based the study on data obtained from health maintenance organizations, preferred provider organizations and point-of-service plans, consumer-driven health plans and health insurance exchanges.

According to this study, 71% of metropolitan areas studied had a significant absence of health insurer competition and 40% of these, as well as 14 states, contained a single insurer that had at least a 50% share of the market. These states included Alabama, Delaware, Hawaii, Illinois, Indiana, Louisiana, Michigan, Nebraska, North Carolina, North Dakota, Rhode Island, South Carolina, Vermont and Wyoming.

“High-quality medical care is only possible if regulators enforce antitrust laws to prohibit harmful health insurance mergers that run counter to patients’ best interests,” Gurman said. “It is clear that more can be done in certain states where the attorneys general have not yet taken a strong stance against the mergers. To ensure patients are better served by dynamic and competitive health insurance markets, the AMA will work to expand the bipartisan group of state attorneys general that has joined the Justice Department to block the massive deals.”

References:

American Medical Association. Markets where an Anthem-Cigna merger warrants antitrust scrutiny.

American Medical Association. Markets where an Aetna-Humana merger warrants antitrust scrutiny. Both found at www.ama-assn.org/ama/pub/advocacy/topics/antitrust-reform.page?

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