HIAA, AAHP Boards Have Approved Merger Plan, Health Insurance Trade Groups Announce

The boards of directors for the American Association of Health Plans and the Health Insurance Association of America last week voted to merge the two insurance industry trade groups, a move that would establish a "lobbying powerhouse for an industry that already holds considerable clout," the Wall Street Journal reports. Members of each of the two groups will vote on the proposed merger next month. AAHP has 1,000 members and HIAA has 400 members, which combined provide health coverage to more than 200 million U.S. residents (Lueck, Wall Street Journal, 9/23). Traditionally, AAHP has represented managed care plans and HIAA has represented insurers that provide fee-for-service health plans. Many insurers, however, have begun to offer a number of different health plans, and the "distinctions between the two groups' members have largely evaporated," The Hill reports. In addition, the two groups have similar legislative agendas, which will "make it easy to merge the policy shops," The Hill reports. Both groups support a larger role for private insurers in the provision of a Medicare prescription drug benefit and increased reimbursements for Medicare HMOs. In addition, both groups have the same position on the medical malpractice and patients' rights issues (Gerber, The Hill, 9/23). Both groups also oppose state-level health coverage mandates and support increased access to health coverage for uninsured U.S. residents (Wall Street Journal, 9/23). The AAHP and HIAA spent a combined $9.3 million on lobbying efforts last year, and each group has a budget of about a $20 million, The Hill reports. William McCallum, chair of AAHP, said that the new group would have a 40% larger budget than the current AAHP budget. AAHP president Karen Ignagni, who will head the new group, said, "On every piece of legislation one can make a strong case that having one voice representing our constituency is always better than having two voices" (The Hill, 9/23). HIAA president Don Young will leave the group to "pursue other opportunities," CongressDaily reports (CongressDaily, 9/22). AAHP and HIAA came close to a merger in November 2000, but the "talks bogged down at the last minute," the Hartford Courant reports (MacDonald, Hartford Courant, 9/23).