HIAA, AAHP Set to Announce Merger This Week

The Health Insurance Association of America and the American Association of Health Plans will likely announce a preliminary merger agreement today or tomorrow, CongressDaily reports (Serafini, 11/29). By forming a "giant lobby" the groups hope that speaking with "one voice" will provide them with "more clout" in their efforts to head off a patients' bill of rights and other government regulations in Congress (Meckler, AP/Nando Times, 11/29). Scott Serota, head of the Blue Cross/Blue Shield Association, said that the merger will imbue the health care industry with a "more consistent voice on important issues" and "more clout" (CongressDaily, 11/29). "It will probably make them a more cost-effective lobby. They'll be able to spend their resources better and won't have to spend time coordinating," Paul Ginsburg, president of the Center for Studying Health System Change, added (AP/Nando Times, 11/29). Members of both HIAA and AAHP remain "frustrated" with Congress' failure to conclude the debate over patients' rights legislation, and some of their member CEOs argue that the industry should have presented a "unified" front and "cu[t] a deal" with congressional leaders earlier, industry sources said (CongressDaily, 11/29). Still, some outsiders expressed doubts about the success of the merger. "They've gone from two voices to one," Judy Waxman of Families USA said, adding, "Obviously, it's a bigger voice, but if you had two strong voices, that's sometimes better than one if you're trying to get a point across." The merger also illustrates the "changing face of health insurance" in America, clouding the distinction between traditional insurance plans and HMOs. "The lines have all blurred, big-time," Blue Cross/Blue Shield Association spokesperson Bill Pierce said (AP/Nando Times, 11/29). "This is a merger of the organization that created the Clinton health care plan with the organization that defeated the Clinton health care plan," Sara Nichols of the California Nurses Association added, concluding, "The merger represents the final and complete acknowledgement of the takeover of the health care industry by HMOs" (CNA release, 11/29).

Kahn's Future Unclear
Under the terms of the merger, Karen Ignagni, president of AAHP, will head the new organization, industry sources said, addressing a potential "sticky matter" in the agreement. The decision, however, leaves the future uncertain for "high profile" HIAA President Chip Kahn. According to industry sources, Kahn may take the helm at HCFA or another top health care post in a George W. Bush administration (CongressDaily, 11/29).

Managed Care Factor
In other managed care news, Congress Daily reports that Congress' failure to pass patients' rights legislation may have affected voters -- especially in tight races where managed care reform became a pivotal issue -- but the issue's impact on the 107th Congress remains "open to interpretation." While some pundits suggest that "fallout" over HMO reform may have helped the Democrats grab Senate seats from GOP incumbent Sens. Spence Abraham (Mich.), Rod Grams (Minn.), William Roth (Del.) and John Ashcroft (Mo.), others attribute their defeats to "unique local circumstances." One Senate GOP aide said, "It's not because of managed care, because you can make the same argument on (prescription) drugs and minimum wage." In the House, Kentucky Republican Reps. Ernie Fletcher and Anne Northup both retained their seats despite "heavy advertising" on HMO reform from challengers. Still, Democratic, Republican and non-partisan post-election polls all indicated that education, the economy and Social Security top health care concerns on a list of key issues. According to a recent HIAA poll conducted by the bipartisan Public Opinion Strategies/Mellman Group, 18% of voters surveyed chose health care as the most important issue, and an AAHP poll offered similar results. The AAHP survey also indicated that voters prefer a narrower patients' bill of rights that includes a "speedy appeals process" but not right-to-sue provisions.

'We'll Be Back'
However, supporters of broader managed care reform have "t[aken] issue" with the AAHP poll's questions, citing earlier, non-partisan polls that indicated "strong support" for right to sue measures. "We'll be back," one Senate Democratic aide said, vowing that health care issues would remain a "high priority." A spokesperson for Rep. Charles Norwood (R-Ga.), co-sponsor of the House-passed Norwood-Dingell patients' rights bill, added that the legislation now has a "filibuster-proof majority" in the Senate and that both presidential candidates have indicated support for right to sue provisions. Meanwhile, the lobbying community has reached a "growing consensus" that Congress will pass a patients' rights bill with provisions "long opposed by the business community" (Fulton, CongressDaily, 11/29).