The American Hospital Association (AHA) is applauding a recent decision by a federal judge denying Aetna's and Humana's request to merge, saying such a move was likely to substantially lessen competition for individual Medicare Advantage plans.
According to an article on the AHA website, U.S. District Judge John Bates wrote in his decision, “The companies’ rebuttal arguments are unpersuasive: federal regulation would likely be insufficient to prevent the merged firm from raising prices or reducing benefits, and neither entry by new competitors nor the proposed divestiture to Molina would suffice to replace competition eliminated by the merger. The merger would also be likely to substantially lessen competition on the public exchanges in three Florida counties.”
AHA President and CEO Rick Pollack said the decision “rightly puts the needs of patients first in ensuring they have access to health care coverage that is affordable,” according to the article.
Pollack added the ruling gives “more than 2.7 million Medicare Advantage patients the benefits of greater competition, including lower out-of-pocket costs and more access to high-quality care.”
Humana and Aetna are the second- and fourth-largest Medicare Advantage insurers, respectively, with plans in more than 1,000 markets.
“If this deal had been allowed to proceed, it would have eliminated current competition as well as the possibility of future competition,” Pollack said. “Such consolidation would no doubt result in higher premiums and less choice. Competition in the insurance sector is essential to keeping Medicare Advantage healthy, growing and affordable for seniors; with today’s decision the court affirmed the importance of those benefits.”
