Lack of Competition is Not Good For Consumers

Mar 01, 2016 - 07:37 AM

Today in a letter to the Department of Justice (DOJ) the AHA raised concerns about the proposed Anthem acquisition of Cigna focusing on the impact of Anthem’s affiliation with the Blue Cross Blue Shield System.

The letter states:

“Previous investigations also suggest that increased Blue plan market power will raise, not lower, premiums to consumers. We would expect that same impact on premiums in any state with a dominant or near-dominant Blue plan that gains any additional market power as a result of this acquisition.  And, no speculative claim of efficiency gains by the parties can offset the likelihood that premiums will increase for consumers as a result of this transaction.

Finally, the temptation for dominant plans to abuse their market power will only increase as a result of this acquisition.  Some dominant Blue plans already have the financial and other means to undermine or defeat entry or expansion by other plans, even established plans.  Eliminating a national competitor better able to withstand the onslaught of a variety of anticompetitive tactics will almost certainly embolden this conduct, thereby harming, perhaps irreparably, any chance of increasing competition and consumer choice.”

The AHA continues to ask DOJ to challenge this acquisition and examine the impact on competition, including the increase in barriers to competition in states where Anthem is not the Blue plan because we believe this deal threatens to undermine reform by discouraging or blocking entirely new entry and entrenching already dominant insurers across the nation.

Related News Articles

Headline
CMS approves Ariz. Medicaid waiver with work requirement
The Centers for Medicare…
Perspective
Perspective: Turning the Tide on the Prescription Drug Spending Crisis
Last week, I shared a few areas where we can advance health in America this year, even in a divided Congress.
Headline
FDA takes steps to spur OTC versions of naloxone
To encourage drug companies to seek approval for over-the-counter versions of naloxone, an emergency treatment for opioid overdose, the Food and Drug…
Headline
CDC: Rural patients more likely to receive opioid prescription
Patients in the most rural counties had an 87 percent greater chance of receiving an opioid prescription from their primary care provider between January 2014…
Headline
AHA Releases New Report that Shows Continued Rising Drug Prices and Drug Shortages are Disrupting Patient Care, Hospital Budgets
Continued rising drug prices, as well as shortages for many critical medications, are disrupting patient care and forcing hospitals to delay infrastructure and…
Headline
AHA recommends certain changes to Medicaid/CHIP managed care rule
AHA said it generally supports CMS’ efforts to grant greater state-level flexibility and reduce regulatory burden, but urged the agency to ensure Medicaid…