US District Court Blocks Aetna-Humana Merger

US District Court Blocks Aetna-Humana Merger

Created on: Tuesday, January 24, 2017
Author: Peter MIchaud

Yesterday it was announced that the US District Court for the District of Columbia has blocked the proposed $37 billion Aetna-Humana merger. This is good news for physicians and patients. The Maine Medical Association joined with the AMA and many other state medical societies to oppose this merger as well as the Anthem-Cigna merger, which is still in litigation.


U.S. District Judge John Bates was not impressed by the merging parties’ arguments for greater efficiencies. He ruled that new companies entering the market would not be sufficient to replace the competition that would be eliminated by the proposed merger. Judge Bates referred to “overwhelming market concentration figures generated by the merger,” finding the companies’ rebuttal arguments “unpersuasive.”


The U.S. Department of Justice, which sued in July 2016 to block the merger plans, took the position that the two mergers would reduce the number of large insurers from five to three, thus reducing the competition for individual Medicare Advantage plans and individual exchange policies. In the case of Aetna and Humana Judge Bates agreed. (The case involving Anthem and Cigna is before a different judge and involves somewhat different legal issues.)


Aetna has said it is reviewing the judge’s ruling and will decide soon whether to file an appeal.


Andrew W. Gurman, M.D., President of the American Medical Association, said in a statement, "Elderly patients were the big winners today...The court ruling halts Aetna’s bid to become the nation’s largest seller of Medicare Advantage plans and preserves the benefits of health insurer competition for a vulnerable population of seniors." Dr. Gurman went on to state, “The AMA’s stand against this anticompetitive merger shows again that when doctors join together, the best outcome for patients and doctors can be achieved. Given the troubling consolidation trends in health insurance industry, the AMA will continue to advocate on behalf of patients and physicians to foster more competitive health insurance markets."


The MMA applauds Judge Bates's ruling. Although the state of health insurance in the United States is in flux at the moment, this development is good for both physicians and patients.


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