In Wake of Unprecedented Consolidation in Health Insurance Market, Blumenthal Urges DOJ to Combine Merger Reviews, Ensure Assessment of Full Impact on Consumers

Press Release

Following today's announcement that Anthem Inc. will acquire Cigna Corp. and the Aetna-Humana merger announced earlier this month, U.S. Senator Richard Blumenthal urged the U.S. Department of Justice (DOJ) to scrutinize the proposed mergers as a whole, not in isolation from one another. In his letter to DOJ Assistant Attorney General Baer, Blumenthal stated that only by reviewing the mergers as a whole will the DOJ be able to fully and accurately evaluate the significant impact the recent healthcare market consolidation will have on consumers and competition.

"Today's announcement continues the apparent merger frenzy among the five largest health insurance companies in the United States," Blumenthal wrote. "This trend toward consolidation in the health insurance market would grant insurers greater leverage -- and with it greater potential for market power abuse -- and it mirrors major consolidation among hospitals and doctor practices, as well as mergers between medical device makers and other suppliers."

"In a market as important to consumers as health care, this level of consolidation raises serious concerns and could alter access to affordable health care in a number of ways…The combined effect of these two proposed transactions would be to reduce the number of large, national health insurance providers from five to three. This outcome will increase consolidation significantly in the sale of health plans to national accounts, reducing employers' power to bargain on behalf of their employees."

"When viewed together both of these proposed deals raise competitive concerns related to an increase of excessive buying (or monopsony) power, which could depress the reimbursement rates paid to physicians and lead to a reduction in quality of care. The national implications are such that each individual merger cannot be reviewed independently from one another."

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