The wave of mergers and acquisitions in health care in the age of reform hasn’t stopped – and three top-notch health policy experts in a recent guest post in Forbes explain why we should worry about that.
U.S. District Judge Amy Berman Jackson has blocked the merger of Anthem and Cigna, the second court ruling this year against megamergers in the health insurance industry.
On Thursday, Anthem said it would appeal the Feb. 8 ruling promptly and request an expedited hearing. Cigna said it would review the decision and evaluate its options. Anthem has a financial incentive to appeal given that under the terms of the merger proposal, Anthem agreed to pay Cigna $1.85 billion if the deal fell apart. Continue reading
U.S. District Judge John D. Bates on Monday sided with the Department of Justice to block the merger of Aetna and Humana. The ruling is being called a victory for members of Medicare Advantage (MA) plans, since Aetna and Humana — two of the nation’s largest health insurers would, as a combined company, have owned the biggest share of the Medicare Advantage market, The Wall Street Journal reported.
For journalists covering health insurance in their cities and states, there’s a story on how the merger would have affected competition in states where the two companies compete. Continue reading
Any health insurance company that seeks to buy another insurer will have some tough questions to answer. So, after Aetna made a formal offer to buy Humana on Thursday and Centene offered to buy Health Net on Wednesday, one of those questions has to be: Will consumers benefit?
“The combined entity will help drive better value and higher-quality health care by reducing administrative costs, leveraging best-in-breed practices from the two companies – including Humana’s chronic-care capabilities that measurably improve health outcomes for larger populations – and enabling the company to better compete with more cost effective products.”
Statements like these will form the basis of the companies’ arguments before the federal Department of Justice, which has already said it will scrutinize any mergers or acquisitions involving health insurers. Continue reading
When health system executives tout the benefits of acquiring hospitals or physician groups, they often say the combined entity will benefit consumers and insurers by improving health care quality and reducing costs.
A case in point is a plan from Partners HealthCare in Boston to acquire Harbor Medical Associates, a 70-physician practice south of Boston. The goal of the acquisition is to improve patient care, coordinate care to boost patient outcomes and cut costs, reported The Boston Globe’s Priyanka Dayal McCluskey. Partners is the highest-cost health system in the state, she wrote.
In a post about the proposal in his blog, Not Running a Hospital, Paul Levy wrote that the acquisition would cause Harbor Medical doctors to steer patients to Partners’ hospitals. “So not only would local MD visits become more expensive: Follow-up secondary and tertiary care would also,” Levy wrote.
Now, in a new report, researchers for the National Academy of Social Insurance, show there is little evidence that organizing hospital and physician care into integrated delivery networks (IDNs) has promoted quality or reduced costs. “Indeed, there is growing evidence that hospital-physician integration has raised physician costs, hospital prices and per capita medical care spending,” the report said. Continue reading