Physicians’ Group: Insurer Mergers Will Reduce Competition, Lead To Higher Prices

Bloomberg News (9/8, McLaughlin) reports the American Medical Association said in studies released Tuesday that Anthem Inc.’s planned acquisition of Cigna Corp. and Aetna Inc.’s proposed takeover of Humana Inc. would reduce competition among health insurers in 154 metropolitan areas across the nation, possibly leading to higher premiums and lower payments to physicians. “The prospect of reducing five national health insurance carriers to just three should be viewed in the context of the unprecedented lack of competition that already exists in most health insurance markets,” the AMA said. According to Bloomberg News, the AMA study “relied on the Herfindahl-Hirschman Index, which is also used by antitrust authorities reviewing deals.”

Reuters (9/9) reports the AMA found the Anthem-Cigna merger would affect competition in 13 states where they sell individual policies and in all 14 states where Anthem operates Blue Cross Blue Shield plans. An Aetna-Humana deal would reduce competition in as many as 14 states overall, according to the analysis. Reuters notes that the majority of Humana’s business is in Medicare Advantage, which is not included in the study.

Related Links:

— “Anthem, Aetna Deals Threaten Competition Across U.S., AMA Says,” David McLaughlin, Bloomberg News, September 8, 2015.

Posted in In The News.