- California Insurance Commissioner Dave Jones on Thursday urged national antitrust regulators to block Aetna's $37 billion acquisition of Humana.
- He officially declared the Aetna/Humana megamerger anticompetitive citing reduced competition, an already concentrated health insurance market, a decrease in quality, and an increase in prices.
- Commissioner Jones called on the U.S. Department of Justice last week to block the pending $54 billion Anthem/Cigna megamerger as, "it is more than reasonably probable that it will substantially lessen competition based on the factors recited in the DOJ and FTC Horizontal Merger Guidelines," he wrote in a June 16 letter.
On Monday, the director of the California Department of Managed Health Care approved the Aetna/Humana merger. To abide by the approval's conditions, Aetna agreed to limit small group premiums and allow for the oversight of its rates to be expanded.
An Aetna spokeswoman told California Healthline,“We received approval earlier this week from the Department of Managed Health Care, the only regulatory agency in the state with official oversight of our acquisition.” While Jones does not have the authority to block the megamerger, his findings have the potential of influencing the DOJ, California Healthline noted.
"One thing we know for sure is consumers do not benefit when there are fewer choices due to a lack of competition," Jones wrote in his letter. "The Aetna and Humana merger has anti-competitive impacts that will likely result in increased prices, decreased availability of health insurance products, and decreased quality and access to healthcare."
If approved, Jones said the Aetna/Humana merger would combine the third and fifth largest health insurers by market value where the second and fourth largest insurers by market value - Anthem and Cigna - also have a pending proposed merger.
Democratic senators from seven different states sent a letter earlier this week urging the DOJ to challenge the two proposed mergers of Aetna with Humana and Cigna with Anthem raising anticompetitive concerns. Senator Richard Blumenthal (D-CT) argued the Anthem/Cigna megamerger could have a devastating effect on Connecticut because it's where the insurers are based.