Another Victory for Connecticut Consumers: Anthem-Cigna Merger Blocked

by Jill Zorn

Plastic stamp in hand, isolated

In a victory for Connecticut consumers, the proposed Anthem-Cigna mega-merger has been blocked by U.S. District Judge Amy Jackson Berman.  This decision follows by just a few weeks the ruling of another federal judge to block the proposed Aetna-Humana merger.

While Anthem and Cigna claimed the merger would mean economies of scale, greater efficiencies and more innovation, the court found the deal would, “increase prices and reduce competition.”  In fact, the Judge was very clear that she doubted that allowing the formation of a huge monopoly that would then put pressure on provider prices would actually result in savings for consumers.

“Anthem is asking the Court to go beyond what any court has done before: to bless this merger because customers may end up paying less to healthcare providers for the services that the providers deliver even though the same customers are also likely to end up paying more for what the defendants sell… Anthem is encouraging the Court to ignore the risks posed by the proposed constriction in the health insurance industry.”

Today’s news is the culmination of a fight that Universal Health Care Foundation of Connecticut began waging, in conjunction with many allies and partners, over a year ago.

We began raising red flags about both the Aetna-Humana and Anthem-Cigna mergers in December 2015.  We quickly decided that we couldn’t do this work alone and decided to form a coalition with the Connecticut State Medical Society (CSMS) and the Connecticut Citizen Action Group (CCAG).  Working together, we were able to get the word out about the harm these mergers would cause as well as recruit other individuals and organizations to join us in opposing them.

The foundation focused on enlisting the help of other national and state-based health care advocacy groups.  One crucial professional relationship we developed was with Attorney David Balto, a consumer-oriented anti-trust lawyer, and his Coalition to Protect Patient Choice.  Other national groups that provided crucial advice and assistance included Consumers Union Healthcare Value HubFamilies USA and Universal Health Care Action Network.

Thanks to these contacts and our partnership with CSMS and CCAG, we succeeded in getting 43 groups from around the country to send a letter to the Department of Justice (DOJ) urging the DOJ to use its “expertise and enforcement power to protect people from the harm these mergers will cause.”

One major focus of our efforts was to highlight concerns about the potential conflict of interest posed by Insurance Commissioner Katharine Wade’s close ties to Cigna.  Despite these connections, the Commissioner had refused to recuse herself from presiding over the expected hearing that the Connecticut Insurance Department would hold to review the Anthem-Cigna merger.

The conflict of interest story was amplified by the persistent coverage from a national investigative journalist, David Sirota, writing for the International Business Times.  By late June, the foundation succeeded in getting over 600 people to sign our petition asking the Commissioner to resign.

As the time grew closer for DOJ to decide whether they would  oppose the mergers in court, Connecticut elected officials weighed in with their concerns, including Senator Richard Blumenthal, and State Comptroller Kevin Lembo.

Along the way, the foundation had several opportunities to speak directly with staff at the Connecticut Attorney General’s office as well as DOJ officials and express our misgivings about the mergers and the Insurance Department review process.  And we began to prepare for the public hearing that the Insurance Department would hold on the Anthem-Cigna merger.

In the end, that hearing was never held.  Instead, in July the DOJ decided to oppose both the Aetna-Humana and Anthem-Cigna mergers in court.  Attorney General George Jepsen signed on with ten other states and the District of Columbia in opposition to the Anthem-Cigna deal.

With the cases filed, we followed the trials and awaited the judges’ decisions.  Which brings us to today’s news, that the long, uphill struggle to stop these mergers has been won, at least for now.

Technically, the fight isn’t over.  Anthem has already announced they will file an appeal and we are waiting to hear what Aetna will do.

But for now, it feels good to see that the courts sided with consumers and not huge corporations, ruling to block the mergers and protect Connecticut residents from the fewer choices, job losses and higher prices they would cause.

Insurance Merger Denied-FINAL.png

 

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