Feds say health mergers would increase costs, threaten care

Federal antitrust regulators also sued to stop Anthem‘s proposed $48 billion acquisition of Cigna.

The Department of Justice said Thursday that the combinations – Aetna and Humana and Anthem and Cigna – would hurt competition and result in higher prices and reduced benefits, among other drawbacks. However, they bounced back, and now Humana shares have increased by 5,2 percent, Aetna by 2,3 percent, Anthem gained 2,9 percent, and Cigna rose by 1.9 percent.

Cigna separately warned that the merger would not be completed this year. Reuters in January reported more than a dozen state attorneys general joined the Department of Justice to look into the mergers.

Florida is one of seven states and the District of Columbia joining the suit, according to a news release Thursday from state Attorney General Pam Bondi’s office.

An Aetna spokesman declined comment on the Georgia postponement Thursday. IL was one of eight states to join the antitrust suit against Aetna and Humana.

Three of the four companies being challenged by the Justice Department said they plan to contest the move. Each of the four companies involved clapped back with varying degrees of concern.

If the health insurers decide to fight the lawsuits, Bloomberg reports that it would likely take months to resolve. “Therefore, extreme caution should be taken in reviewing whether the mergers should be approved at all”.

The Affordable Care Act was signed into Congress in 2010 and was meant to make health insurance more affordable for low-income earning Americans since it is required that they belong to one. “But that’s exactly the risk posed by these two mergers for consumers who today rely on the exchanges”. Without mentioning United, the government also talks about the potential impact of an Aetna-Humana deal on the Medicare market, where the insurers sell what are called “Medicare Advantage” health plans.

“But that was then, and this is now”, a source close to the situation said, implying that Aetna, without the financial benefits of the merger, may also choose to exit exchanges in states where it is losing money. It goes without saying that the majority of individuals, large companies, agencies on aging and others are against the proposed mergers.

Anthem, Inc.is headquartered in Indianapolis, Indiana.

Before Thursday’s DOJ action, Aetna and Anthem had each argued that their proposed purchases would help lower prices for consumers, by giving them greater leverage in negotiating with doctors and hospitals. “We will not hesitate to intervene”.

“For most Americans, health insurance is not a luxury, but a necessity”, said Attorney General Loretta Lych, announcing the antitrust lawsuits.

Aetna and Humana will defend themselves vigorously in the lawsuit, and we remain firm in our belief that bringing the two companies together is in the best interest of consumers, particularly seniors.

The complaint alleges that the merger could substantially reduce competition for the sale of Medicare Advantage plans in numerous counties throughout the US, including the OH counties of Brown, Butler, Clermont, Columbiana, Delaware, Franklin, Hamilton, Hancock, Jefferson, Marion, Meigs, Muskingum, and Seneca.