AAI Praises District Court Opinion Enjoining Aetna-Humana Merger

Jan 24 2017
AAI Announcements

Today, the AAI praised Judge John D. Bates’s opinion granting the U.S. Department of Justice (DOJ) an injunction to block the merger of health insurers Aetna and Humana. AAI President Diana Moss noted, “This is a victory for competition and consumers. The opinion sets forth a clear, logical, and understandable rationale for why the merger would have raised prices and reduced benefits to consumers in important health insurance markets.”

In a letter to the DOJ in January 2016, the AAI laid out the case for why the government should block both the Aetna-Humana and Anthem-Cigna mergers, raising numerous issues addressed in Judge Bates’s opinion. These include, among others, the finding that Medicare Advantage and Medicare are different markets. Similarly, the opinion holds that the merging parties’ efficiency defense “fails,” particularly in light of very high levels of market concentration and with most claimed efficiencies likely to flow to the merging parties, not to consumers.

The Aetna-Humana case joins several other mergers over the last few years in which the government mounted a successful challenge or signaled significant concern. This list includes Sysco-US Foods, Baker Hughes-Halliburton, Staples-Office Depot, and Comcast-Time Warner Cable. These cases, Moss stated, “signal the vital role of antitrust enforcement in ensuring that the competitive process in U.S. markets is allowed to work, to the benefit of consumers, competitors, and innovators. This should have broad based appeal to any proponent of our market based system.”

The AAI’s advocacy on healthcare remains at the top of the organization’s agenda. On February 22, 2017, the AAI will hold its first Healthcare Roundtable, where experts will unpack competition issues surrounding provider, pharmaceutical, and health insurer markets.