By Jill Zorn
With the proposed mega-mergers of Aetna with Humana and Anthem with Cigna, how is the jobs discussion playing out in our state? More importantly, how many insurance jobs will be left in Connecticut if the proposed mergers go through?
Here’s a breakdown of the jobs in the state:
Kentucky’s insurance commissioner approved the Aetna-Humana merger in early February, without a public hearing and even before receiving a report from economists hired to analyze the deal. With Humana headquartered in Kentucky and thousands of jobs potentially at stake, this swift approval caught many people by surprise.
But perhaps we shouldn’t be surprised. As Dan Haar of the Hartford Courant reports, the agreement that Aetna and Humana signed when the merger was first proposed specifically states that Humana’s headquarters will maintain “a significant corporate presence in Louisville.”
Just one week before the Kentucky Insurance Commissioner approved the merger, Aetna CEO Mark Bertolini was the keynote speaker for the main business organization in Louisville. There he proudly proclaimed, “We’ve made a commitment to only one community as part of our worldwide business and that’s Louisville.” He also promised that raises are coming to many Humana employees once the deal is finalized.
Has Aetna made any similar promises to Connecticut regarding job losses? The headline of Haar’s piece says it all, “Aetna’s silence points to headquarters in play.” So even when a company is on the winning end of a merger, there do not seem to be any job guarantees on the table for Connecticut. More information may become available when Aetna files the paperwork to have the merger approved in Connecticut.
When the Anthem-Cigna deal was announced in July, this was the Indianapolis Business Journal headline: “City dodges bullet”, since the Anthem headquarters will remain in Indianapolis. Whether their 5,000 Anthem jobs are completely safe, remains to be seen. The Indiana Department of Insurance is holding their public hearing on the Anthem-Cigna merger on April 29. It will be interesting to see if job retention, or even job growth, is discussed at the hearing.
With Cigna being on the losing end of the merger deal with Anthem, there is clearly cause for concern regarding Connecticut-based jobs.
The Courant reports that the papers filed by Anthem with the Insurance Department mention, “No plans to cut workers ‘in any material respect’”, and points out that job losses may be most likely in Cigna’s human resources, payroll, finance and accounting departments.
In 2011, Governor Malloy made a “First Five” agreement with Cigna. In exchange for a $51 million aid package, Cigna promised to add 200 jobs and move the corporate headquarters to Connecticut from Philadelphia. It’s possible this agreement may help to save some Cigna jobs, but the way it was structured, as many as 700 jobs could be cut with little or no financial repercussions. And any tax credits and grants already awarded will not be returned.
The fate of Anthem’s 1,200 employees housed in Wallingford to manage their Connecticut-based business is not known.
If you want to learn more about the impact of insurance mergers in Connecticut, you may want to attend a forum being held in Mansfield Center at the Mansfield Public Library on Monday, April 11 from 6:30 – 7:30 p.m. This informational session is being hosted by four Eastern Connecticut legislators and the Connecticut Campaign for Consumer Choice, composed of Universal Health Care Foundation, the Connecticut State Medical Society and the Connecticut Citizen Action Group.