AHA: Health insurance consolidation could harm consumers, care improvement

Anthem’s proposed acquisition of Cigna and Aetna’s proposed acquisition of Humana “merit the closest scrutiny from the Department of Justice’s Antitrust Division and Congress,” AHA told the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights today. The “unprecedented consolidation,” which would result in a reduction in the number of large national health insurance companies, threatens to “make health care more expensive and less accessible” for consumers and derail hospital efforts to improve the health care delivery system, AHA President and CEO Rick Pollack testified at the hearing on health insurance industry consolidation and its impact on consumers. “There is no reason to believe that allowing these insurers to become even larger – and more immune from competitive forces – would change their incentive to sit mostly on the sidelines and reap the considerable financial rewards of providers’ innovation,” he said. Also testifying at the hearing, Leemore Dafny, research professor in hospital and health services at Northwestern University’s Kellogg School of Management, said studies “suggest that [health insurance] consolidation leads to premium increases. This is true notwithstanding the growing body of research that finds insurers with larger local market shares pay lower rates to health care providers, particularly hospitals.” Representatives from Anthem, Aetna and Consumers Union also testified at the hearing. For more on AHA’s testimony, see today’s AHASTAT blog post.