Insurance Merger Raises Questions For Consumers
The companies suggest they will be able to serve customers better at lower rates, but the long-term effects on consumers' choices and costs are uncertain, analysts suggest. News reports also look at the health law's impact on the merger.
The Associated Press:
Insurer Merger Mania Paints Muddied Picture For Consumers
More than a third of the U.S. population has health coverage through an insurer that either wants to make a huge acquisition or is about to be swallowed up in one. Aetna laid out a plan on Friday to spend around $35 billion to buy the Medicare Advantage provider Humana Inc. That came a day after Centene Corp. and Health Net Inc. announced a smaller deal and a couple of weeks after Anthem Inc. went public with its offer of more than $47 billion for Cigna Corp. (Murphy, 7/3)
The New York Times:
With Merging Of Insurers, Questions For Patients About Costs And Innovation
The nation’s five largest health insurance companies are circling one another like hungry lions closing in on prey. ... As insurers grow larger, will consumers benefit from the companies’ ability to bargain with hospitals and doctors for lower prices? Will diminishing competition translate to fewer choices of plans? And what effect will mergers have on innovation in health care? The answers depend largely on how successfully the other insurers, particularly those that were created or attracted by the Affordable Care Act, can compete with these much larger companies. (Abelson, 7/5)
USA Today:
Aetna, Humana CEOs Say Deal Bolsters Medicare, Medicaid Businesses
The CEOs of Aetna and Humana say the $37 billion merger they announced Friday will help consumers because of the two companies' complementary strengths in technology and relationships with health care providers. The combined company's government business — Medicare, Medicaid and Tricare — will be based in Louisville and will be the biggest part of the company, totaling about 56% of the combined companies' projected 2015 operating revenue of about $115 billion. (O'Donnell and Ungar, 7/3)
Los Angeles Times:
Obamacare Cash Fuels Healthcare Merger Mania
Riding high on Wall Street and flush with cash, big health insurers in particular have been on the prowl for deals. Atop the shopping list are companies that boost their government business. “The Affordable Care Act is really driving this merger mania,” said Gerald Kominski, director of the UCLA Center for Health Policy Research. “There are billions of dollars pouring into the system, and it's money to buy insurance.” President Obama's signature health law has unleashed the biggest expansion of insurance coverage in half a century, lifting stock prices and revenues across the healthcare industry. (Terhune, 7/2)
The Wall Street Journal:
With Merger Deal, Aetna, Humana Get Ahead Of The Pack
In the game of merger musical chairs the five biggest health insurers have been playing lately, Aetna Inc. and Humana Inc. hustled to grab the first seats. The two insurers disclosed their $34.1 billion tie-up after 2 a.m. EDT Friday, as the holiday weekend was beginning and after reports that rivals Anthem Inc. and Cigna Corp. had rekindled talks. ... The frenzied talks, sparked earlier this year by an overture to Humana, reflect managed-care companies’ desire to diversify and cut costs in the wake of the federal Affordable Care Act and other changes in the health-care industry. (Wilde Mathews, Hoffman and Mattioli, 7/5)
The Hill:
McConnell: Obamacare To Blame For Health Care Consolidation
Senate Majority Leader Mitch McConnell (R-Ky.) is blaming ObamaCare for the consolidation of insurers after health insurance giant Aetna announced the purchase of a Louisville-based health insurance company on Friday. “For more than 30 years, Humana has been a cornerstone of economic growth and a great philanthropic partner in our community,” he said Friday in a statement. (Kamisar, 6/3)
The Wall Street Journal:
Aetna-Humana Merger Marks Sway Of Health-Care Law
The two chief executives said Friday changes stemming from the Affordable Care Act, which has pushed the industry toward individual coverage and new ways of paying providers, helped set the stage for their deal. The health law was “an action-forcing event that has catalyzed a lot of very important discussions,” Aetna CEO Mark Bertolini said. Humana CEO Bruce Broussard flagged changes in the health-care system that are often tied to the law, including an increasing focus on selling to individuals rather than employers. (Wilde Mathews, Hoffman and Matioli, 7/3)
