Medical associations ask Florida to halt Aetna–Humana merger

As state and federal governments conduct their review of the insurance giant megamerger between Aetna Inc. and Humana Inc., resistance on antitrust concerns is coming not only from individual consumers but also from physician groups. The Florida Office of Insurance Regulation solicited public comments for a December 7, 2015, hearing relating to the proposed acquisition, and received a joint statement from the American Medical Association (AMA), Florida Medical Association (FMA), and Florida Osteopathic Medical Association (FOMA) opposing the deal as detrimental to consumers.

In Florida, Aetna is proposing to acquire four providers under Humana’s banner: Humana Health Insurance Co. of Florida Inc., Humana Medical Plan Inc., CarePlus Health Plans Inc., and CompBenefits Co. In an independent analysis, Allan Baumgarten’s Florida Health Market Review 2015 found that the combined company would have about 31.5 percent of the state’s insurance market and be the largest insurer. The AMA’s analysis found competitive concerns for four Florida regions: Fort Lauderdale-Pompano Beach-Deerfield Beach, Lakeland-Winter Haven, Miami-Miami Beach-Kendall, and West Palm Beach-Boca Raton-Boynton Beach.

In their joint statement, the medical associations acknowledge their long-standing position in favor of increased competition in the health insurance market, both to provide customers with choice and high-quality service, but also to give physicians the opportunity to bargain for favorable contract terms. They request a 30-day continuation on the hearing to allow critics access to documents and the opportunity to testify before the hearing panel. They further discuss their view that the proposed merger violates competition standards and federal antitrust standards, that the health insurance exchange would not prevent the loss of competition, and that a divestiture of some assets would not only fail to protect against the loss of competition, but also be highly disruptive to the market.

Lastly, the associations note that Medicare Advantage (MA) would be particularly hurt by the merger, as the combined company would serve 44 percent of the MA market. A July 2015 analysis from the Kaiser Family Foundation (KFF) noted that if the Aetna and Humana merger proceeds, the resulting business would provide coverage to 26 percent of all MA enrollees (see Many Medicare Advantage enrollees may see shifts in coverage providers, Health Law Daily, July 15, 2015).

There is a nationwide trend of health insurance provider mergers happening as companies look to minimize costs due to the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) (see A sign of the times, mergers demonstrate change in government’s health care role, Health Law Daily, August 26, 2015). The Aetna acquisition of Humana is the largest announced merger (see First post-ACA mega merger moves forward, Health Law Daily, October 20, 2015), and has seen pushback from other organizations including the American Hospital Association (see AHA urges close review of Anthem-Cigna, Humana-Aetna deals, Health Law Daily, August 7, 2015).