U.S. moves to block massive health insurer deals led by Anthem, Aetna
By Caroline Humer and Carl O'Donnell
NEW YORK (Reuters) - U.S. antitrust officials on Thursday moved to block an unprecedented consolidation of the national health insurance market, filing a lawsuit against Anthem Inc's (ANTM.N: Quote) proposed purchase of Cigna Corp CI.N and Aetna Inc's (AET.N: Quote) planned acquisition of Humana Inc (HUM.N: Quote).
The U.S. Department of Justice said the two multibillion-dollar mergers would reduce competition, raise prices for consumers and stifle innovation if the number of large, national insurers were to fall from five to three.
It was the latest example of the Obama administration challenging massive combinations in major industries, from oilfield services to telecommunications.
"We will not hesitate to intervene. We will not shy away from complex cases," U.S. Attorney General Loretta Lynch told a news conference on Thursday. "We will protect the interests of the American people."
The deals would hurt consumers in the different markets served by the four companies, from medical coverage provided by large corporations to their employees to Medicare Advantage plans for the elderly and insurance sold to individuals on exchanges created under President Barack Obama's healthcare reform law, the Justice Department said.
"We have no doubt that these mergers would reduce competition from what it is today," said Principal Deputy Associate Attorney General William Baer, who spearheaded the antitrust reviews.
Merging Aetna's and Humana's Medicare Advantage businesses would create the largest U.S. manager of the healthcare insurance for seniors and the disabled.
The Anthem deal for Cigna would create the largest U.S. health insurer by membership, with about 53 million members, surpassing UnitedHealth Group's (UNH.N: Quote) 45.9 million as of June 30, and make it the leader in employer-based health insurance. Continued...