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
AHA requests CMS reconsider provisions within Medicaid community engagement rule
The AHA July 31 provided comments to the Centers for Medicare & Medicaid Services on its interim final rule on Medicaid community engagement requirements.…
Headline
Essential community providers must apply or renew with CMS by Aug. 12
Current or prospective essential community providers, which are facilities serving predominantly low-income and medically underserved individuals, must update…
Headline
National healthcare groups join HHS effort to improve behavioral health, addiction care
The Health and Human Services Secretary July 29 announced that dozens of insurers, medical societies, healthcare providers and behavioral health…
Headline
CMS issues proposed provider tax rule
The Centers for Medicare & Medicaid Services today released a proposed rule that would update Medicaid provider tax policies included in the July 2025…
Headline
AHA comments to CMS on proposed rule covering Medicaid supplemental payments
The AHA provided comments July 21 to the Centers for Medicare & Medicaid Services on its proposed rule to modify policies governing Medicaid…
Headline
Draft guidance released for 2028 cycle of Medicare drug price negotiations 
The Centers for Medicare & Medicaid Services July 16 released draft guidance for the 2028 cycle of negotiations under the Medicare Drug Price Negotiation…