Panel examines proposed insurance mergers

AHA News Now

Bigger is not better when it comes to the proposed mergers of health insurers Aetna and Humana and Anthem and Cigna, a panel of consumer and advocacy representatives said today, citing the potential for higher prices, lower quality and diminished service for consumers. Speaking at a Capitol Hill event sponsored by the Coalition to Protect Patient Choice, Lynn Quincy, Consumers Union’s director of Health Care Value Hub, said she worries that the proposed mergers could lead to “higher premiums, less incentive to innovate and less transparent rate reviews.” The insurance companies have suggested that competitive concerns can be resolved by their divesting a number of covered lives, and the Department of Justice has used that remedy in the past. But Topher Spiro, vice president of health policy at the Center for American Progress, noted that the divestiture of assets in other mergers did not prevent an eventual increase in premiums. He cited a recent CAP study that found that the divestiture that occurred in the 1999 merger between Aetna and Prudential did not stop price increases of roughly 7% in 139 separate geographic markets, and the divestiture that occurred in the 2008 merger of United Health Group and Sierra Health Services did not stop premium increases of more than 12% in Nevada. “Mergers are irreversible,” Spiro said. “Don’t do anything transformational [in health care] that can’t be easily undone.” Diana Moss, president of the American Antitrust Institute, observed that the proposed mergers could reverse progress made under the Affordable Care Act in “delivering the benefits of more competition to consumers” and urged DOJ to say no to the deals.

Topic: Advocacy and Public Policy
Tags: consolidation, Coverage

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