Insurers Take Aim at Hospitals Amid Calls for Merger Investigations

Insurers have responded to hospitals' requests that antitrust regulators closely scrutinize proposed mergers between some of the nation's largest health plans, Modern Healthcare reports (Schencker, Modern Healthcare, 8/7).

Background

The American Hospital Association on Thursday urged antitrust regulators at the Department of Justice to closely examine Anthem's proposed deal to acquire Cigna, which it said could diminish competition in 817 geographic markets (California Healthline, 8/7). According to AHA, the proposed merger could cause "potential harm to consumers" from a "large and durable" reduction in competition. Further, AHA noted, "Because the two companies generate more than $100 billion in combined revenues, even a modest price increase would cost consumers billions of dollars in higher health care costs" (Chamseddine, CQ HealthBeat, 8/7). According to Modern Healthcare, AHA also intends to send a letter urging regulators give the same scrutiny to Aetna's proposed deal to acquire Humana.

Insurers Strike Back

Beth Leonard, executive vice president of public affairs at America's Health Insurance Plans, said insurers aim to keep "coverage affordable for consumers through negotiating lower medical bills, coordinating care and moving the system toward a more value-based model that rewards quality and fosters collaboration" (Modern Healthcare, 8/7). However, efforts to obtain "better value for patients [are] being undercut by years of anticompetitive hospital consolidation that have forced patients to pay higher health care costs, increased premiums and limited their health care choices," she added (Sullivan, The Hill, 8/7).

Meanwhile, Aetna said it "share[s] a goal with the AHA and other health care providers to move to value-based care."

Review Could Be Underway

According to Modern Healthcare, DOJ could be reviewing the mergers already, as Aetna has submitted its notice of intent. In addition, the Senate Judiciary Committee's Antitrust, Competition Policy and Consumer Rights subcommittee has invited the CEOs of each insurer to testify at a Sept. 22 hearing on the proposed deals (Modern Healthcare, 8/7).