Insurers are coming together but is it pulling mental health care apart?

Proposed mergers that would consolidate the country’s top five insurers into the top three are raising concerns about access to mental health treatment. The prospect of further limiting access to mental health care, which in many places is already difficult to access, is generating opposition to the proposed mergers and is bringing the mergers into a debate about more than competitive markets and antitrust. The concern is that fewer insurers will result in reduced provider choices in some geographic areas.


Humana Inc. and Aetna Inc. announced plans to move forward with Aetna’s acquisition of Humana, following shareholder approval of the $37 billion deal. Additionally, in July, Anthem, a Blue Cross and Blue Shield insurer, agreed to buy all of Cigna’s shares in a cash and stock transaction. The $54 billion deal would create an insurer with 53 million covered members. If the massive consolidations go through, in their wake they will leave an insurance market with only three major players.

Mental Health

The mergers have garnered attention from policymakers. For example, the Senate Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights held a hearing on the issue. There are fears that the specific impact on mental health is not being given adequate attention. Rep. Joseph P. Kennedy III (D-Mass) wrote a letter to antitrust officials requesting “careful consideration of the impact of the proposed mergers on the availability of mental health care and substance abuse treatment.” The letter informed antitrust officials about the precarious state of mental health coverage and the need to ensure enforcement of the parity requirements, which are designed to prevent health plans from imposing less favorable benefit limitations on mental health benefits than on medical or surgical benefits.

Coverage problems

An analysis by the American Medical Association (AMA) determined that the mergers could result in diminished competition in local health insurance markets in almost half of the states. Kennedy has raised concerns that, despite parity laws, greater market power could allow different (lower) reimbursement to psychiatrists than to other kinds of providers. Other potential harms include the possibility that insurers may deny mental health claims more often than other medical procedures or surgeries.

Phantom networks

The American Psychiatric Association (APA) has spoken out against the mergers with a specific emphasis on the potential harm to mental health coverage. The APA wrote a letter to antitrust officials citing “insurers’ history of denying mental health benefits and saying that their networks of psychiatrists were inadequate and likely to worsen.” The APA referred to a phenomenon known as “phantom networks” which refers to a list of doctors that allegedly provide services in network when, in fact, many of the listed doctors are not taking new patients, are not reachable, or were listed by insurers as accepting a plan when they did not. For example, a 2014 study by the Mental Health Association of Maryland found that of the psychiatrists listed as “in-network” for plans sold through Maryland’s Health Connections, only 14 percent of the doctors accepted new patients and could schedule an appointment within the next 45 days. Additionally, more than half of those doctors were unreachable. The APA letter warned that “creating mega-insurers threatens to exacerbate the ‘phantom network’ problem by eliminating competition on both the consumer and provider ends of the service chain.”