Missouri Insurance Department Calls Aetna-Humana Merger Anticompetitive
Missouri became the first state to go on record opposing a proposed merger of insurance giants Humana and Aetna, saying the combination would create an anticompetitive market in the state for various lines of insurance.
A ruling late Tuesday by the Missouri Department of Insurance gives the two companies 30 days to address the department’s concerns. Otherwise, it said it would block them from offering individual, small-group and group Medicare Advantage plans in Missouri if the merger goes through.
Aetna’s is proposing to acquire Humana for $37 billion, a combination that would create the third largest insurer in the United States.
The companies say the deal will lower costs, improve the quality of health care and expand access to health care.
Opponents say it would raise premiums, lessen consumer choice and eliminate competition.
The combined companies would have overwhelming market share in Missouri in Medicare Advantage markets. Medicare Advantage plans are administered by private insurance companies and must offer at least as much coverage as is offered by Medicare Part A and Part B. Nearly a third of Medicare recipients now opt for Medicare Advantage plans, according to the Henry J. Kaiser Foundation.
The Missouri insurance department held a public hearing on May 16 to consider the Humana-Aetna deal. The Missouri Hospital Association, Missouri State Medical Association and various consumer alliances, among others, opposed it. Other groups, including the Missouri Primary Care Association and Encompass Medical Group, supported it.
In a statement, Aetna said that the department’s ruling "does not impede the Department of Justice approval process. We're disappointed, but expect to have a constructive dialogue with the state to address their concerns.”
Dan Margolies, editor of the Heartland Health Monitor team, is based at KCUR. You can reach him on Twitter @DanMargolies.